Question

You find the following corporate bond quotes. To calculate the number of years until maturity, assume...

 You find the following corporate bond quotes. To calculate the number of years until maturity, assume that it is currently January 15, 2019. The bonds have a par value of \$2,000 and semiannual coupons.
 Company (Ticker) Coupon Maturity Last Price Last Yield EST \$ Vol (000’s) Xenon, Inc. (XIC) 6.700 Jan 15, 2036 94.313 ?? 57,375 Kenny Corp. (KCC) 7.250 Jan 15, 2035 ?? 5.40 48,954 Williams Co. (WICO) ?? Jan 15, 2042 94.865 7.10 43,815
 a. What price would you expect to pay for the Kenny Corp. bond? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the bond’s current yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Given,

Par value = \$2000

Coupon rate = 7.25%

Yield = 5.40% or 0.054

Years to maturity = 16 years ( From January 15, 2019 to January 15, 2035)

Solution :-