Question

1. Yield to Maturity and Required Returns

The Brownstone Corporation's bonds have 5 years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 8%

What is the yield to maturity at a current market price of $1,062? Round your answer to two decimal places.

2. Yield to Maturity and Call with Semiannual Payments

Thatcher Corporation's bonds will mature in 11 years. The bonds have a face value of $1,000 and an 9% coupon rate, paid semiannually. The price of the bonds is $1,050. The bonds are callable in 5 years at a call price of $1,050. Round your answers to two decimal places.

What is their yield to maturity?

3. Bond Valuation with Annual Payments

Jackson Corporation's bonds have 5 years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 10.5%. The bonds have a yield to maturity of 9%. What is the current market price of these bonds? Round your answer to the nearest cent

Answer 1

Calc:

Where,

rate is periodic YTM

nper is periods to maturity,

pmt is payment per period,

pv is current price

fv is redemption price of bond