Question

West Corp. issued 14-year bonds 2 years ago at a coupon rate of 9.8 percent. The bonds make semiannual payments. If these bonds currently sell for 103 percent of par value, what is the YTM?

Answer #1

Answer :

**Calculation of Yield to maturity**

Yield to maturity can be calculated using Rate function of Excel

=RATE(nper,pmt,pv,fv)

where nper is the number of years to maturity i.e (14 - 2) * 2 = 24 (Given that bonds are issued two years ago so there are 12 years left for maturity and since there is semiannual coupon payment we multiply it by 2 )

pmt is coupon payment = 1000 * 9.8% = 98 / 2 = 49 (Divided by 2 as semiannual coupon payment)

pv is the current market price i.e 1030 (1000 * 103%)

fv is the face value i.e 1000

As face value is not given we aaume it to be $1000

=RATE(12,49,-1030,1000)

Therefore on solving

**Yield to maturity is 4.68911%(Semiannual)**

**Yield to maturity is 4.68911% * 2 = 9.37822% or 9.38%
(Annual)**

West Corp. issued 16-year bonds 2 years ago at a coupon rate of
9.7 percent. The bonds make semiannual payments. If these bonds
currently sell for 96 percent of par value, what is the YTM

West Corp. issued 21-year bonds 2 years ago at a coupon rate of
9.9 percent. The bonds make semiannual payments. If these bonds
currently sell for 101 percent of par value, what is the YTM?
Multiple Choice A. 8.80% B. 11.74% C. 9.78% D. 4.89% E.
10.76%

1. West Corp. issued 15-year bonds two years ago at a coupon
rate of 8.2 percent. The bonds make semiannual payments. If these
bonds currently sell for 103 percent of par value, what is the YTM?
(Do not round intermediate calculations and enter your
answer as a percent rounded to 2 decimal places, e.g.,
32.16.)
YTM = %
2.
Even though most corporate bonds in the United States make coupon
payments semiannually, bonds issued elsewhere often have annual
coupon payments....

Ngata Corp. issued 18-year bonds 2 years ago at a coupon rate of
10.1 percent. The bonds make semiannual payments. If these bonds
currently sell for 100 percent of par value, the YTM is
percent.

3.Ngata Corp. issued 12-year bonds 2 years ago at a coupon rate
of 9.2 percent. The bonds make semiannual payments. If these bonds
currently sell for 104 percent of par value, what is the YTM?

Watters Umbrella Corp. issued 10-year bonds 2 years ago at a
coupon rate of 8.7 percent. The bonds make semiannual payments. If
these bonds currently sell for 108 percent of par value, what is
the YTM?

Heginbotham Corp. issued 20-year bonds two years ago at a coupon
rate of 5.3 percent. The bonds make semiannual payments. If these
bonds currently sell for 105 percent of par value, what is the
YTM?

Skolits Corp. issued 20-year bonds 2 years ago at a coupon rate
of 7.4 percent. The bonds make semiannual payments. If these bonds
currently sell for 104 percent of par value, what is the YTM?
(Do not round intermediate calculations. Enter your answer
as a percent rounded to 2 decimal places, e.g.,
32.16.)
YTM
%

Skolits Corp. issued 15-year bonds 2 years ago at a coupon rate
of 8.8 percent. The bonds make semiannual payments. If these bonds
currently sell for 109 percent of par value, what is the YTM?
(Do not round intermediate calculations. Enter your answer
as a percent rounded to 2 decimal places, e.g.,
32.16.)
YTM
%

Wolverine Corp. issued 13-year bonds 2 years ago at a coupon
rate of 9.4 percent. The bonds make semiannual payments and carry a
face value of $1,000. If these bonds currently sell for $980, what
is the YTM?
Group of answer choices
8.73%
11.64%
9.70%
10.67%
4.85%

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