Question

Trembol Co.’s bonds, maturing in 3 years, pay 7 percent interest on a $1,000 face value. Interest is paid once per year. If your required rate of return is 6 percent, what is the value of the bond? Assume that the modified duration of this bond is 2.65 years. If the market yield rises by 1%, how much change will there be in the bond's price in %? What will be the new price of the bond?

Answer #1

Ray Co.’s bonds, maturing in 3 years, pay 8 percent interest on
a $1,000 face value. Interest is paid once per year. If your
required rate of return is 6 percent, what is the value of the
bond? (10 points). Assume that the modified duration of this bond
is 2.80 years. If the market yield rises by 1%, how much change
will there be in the bond's price in %? (5 points). What will be
the new price of the...

Flora Co.'s bonds, maturing in 13 years, pay 6 percent
interest on a $1,000 face value. However, interest is paid
semiannually. If your required rate of return is
16 percent, what is the value of the bond? How would
your answer change if the interest were paid
annually?
a. If the interest is paid semiannually, the value of the bond
is

Flora Co.'s bonds, maturing in 17 years, pay 11 percent
interest on a $ 1000 face value. However, interest is paid
semiannually. If your required rate of return is 15 percent, what
is the value of the bond? How would your answer change if the
interest were paid annually?

(Bond valuation) Flora Co.'s bonds, maturing in 8 years, pay
13 percent interest on a $ 1,000 face value. However, interest is
paid semiannually. If your required rate of return is 8 percent,
what is the value of the bond? How would your answer change if the
interest were paid annually?
Please answer in excel functions if possible

A HCA bond, maturing in 7 years, pays 8 percent interest on a
$1,000 face value. However interest is paid semi-annually. If your
required rate of return is 10 percent, what is the value of the
bond? What is the value if the interest were paid annually?

Fitzgerald's 35-year bonds pay 11 percent interest annually on
a $1,000 par value. If the bonds sell at $875, what is thebond's
yield to maturity? What would be the yield to maturity if the
bonds paid interest semiannually? Explain the difference.
a. The bond's yield to maturity if the bond pays interest
annually is __%.
The bonds yield to maturity if the bond pays interest
semiannaually is __

7.
A) As with most bonds, consider a bond with a face value of
$1,000. The bond's maturity is 27 years, the coupon rate is 14%
paid annually, and the market yield (discount rate) is 5%. What
should be the estimated value of this bond in one year? Assume the
market yield remains unchanged. Enter your answer in terms of
dollars, rounded to the nearest cent.
B) As with most bonds, consider a bond with a face value of
$1,000....

2.8 Calculate the duration of a 6 percent, $1,000 par bond
maturing in three years if the yield to maturity is 10 percent and
interest is paid semiannually. b. (3 points) Calculate the modified
duration for this bond.
2.9 Calculate the convexity of the bond in 2.8.
2.10 Given the results in 2.8 and 2.9, if the price of the bond
before yields changed was $898.49, what is the resulting price
taking into account both the effect of duration and...

Fitzgerald's 35-year bonds pay 7 percent interest annually on a
$1,000 par value. If the bonds sell at $945, what is the bond's
yield to maturity? What would be the yield to maturity if the
bonds paid interest semiannually? Explain the difference.

Fingen's 14-year, $1,000 par value bonds pay 9 percent
interest annually. The market price of the bonds is $1,100 and
the market's required yield to maturity on a comparable-risk bond
is 10 percent.
a. Compute the bond's yield to maturity.
b. Determine the value of the bond to you, given your required
rate of return.
c. Should you purchase the bond?

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