Question

Lourdes Corporation's 10% coupon rate, semiannual payment, $1,000 par value bonds, which mature in 10 years, are callable 3 years from today at $1,025. They sell at a price of $1,110.37, and the yield curve is flat. Assume that interest rates are expected to remain at their current level.

What is the best estimate of these bonds' remaining life? Round your answer to the nearest whole number.

Answer #1

Calc:

Lourdes Corporation's 15% coupon rate, semiannual payment,
$1,000 par value bonds, which mature in 25 years, are callable 4
years from today at $1,050. They sell at a price of $1,334.08, and
the yield curve is flat. Assume that interest rates are expected to
remain at their current level.
What is the best estimate of these bonds' remaining life? Round
your answer to the nearest whole number.

Lourdes Corporation's 12% coupon rate, semiannual payment,
$1,000 par value bonds, which mature in 10 years, are callable 6
years from today at $1,050. They sell at a price of $1,306.57, and
the yield curve is flat. Assume that interest rates are expected to
remain at their current level.
What is the best estimate of these bonds' remaining life? Round
your answer to two decimal places.
If Lourdes plans to raise additional capital and wants to use
debt financing, what...

Lourdes Corporation's 13% coupon rate, semiannual payment,
$1,000 par value bonds, which mature in 20 years, are callable 4
years from today at $1,075. They sell at a price of $1,279.30, and
the yield curve is flat. Assume that interest rates are expected to
remain at their current level.
What is the best estimate of these bonds' remaining life? Round
your answer to two decimal places.
years
If Lourdes plans to raise additional capital and wants to use
debt financing,...

EXPECTED INTEREST RATE Lloyd Corporation’s 14%
coupon rate, semiannual payment, $1,000 par value bonds, which
mature in 30 years, are callable 5 years from today at $1,050. They
sell at a price of $1,353 54, and the yield curve is flat. Assume
that interest rates are expected to remain at their current
level.
a. What is the best estimate of these bonds’ remaining
life?
b. If Lloyd plans to raise additional capital and
wants to use debt financing, what coupon...

Absalom Motors's 12% coupon rate, semiannual payment, $1,000 par
value bonds that mature in 20 years are callable 3 years from now
at a price of $1,075. The bonds sell at a price of $1,252, and the
yield curve is flat. Assuming that interest rates in the economy
are expected to remain at their current level, what is the best
estimate of investror's rate of return?
A 9.22%
B 4.61%
C 9.33%
D 5.17%
E 2.58%

Absalom Motors' 15% coupon rate, semiannual payment, $1,000 par
value bonds that mature in 25 years are callable 4 years from now
at a price of $750. The bonds sell at a price of $1,300, and the
yield curve is flat. Assuming that interest rates in the economy
are expected to remain at their current level, what is the best
estimate of the nominal interest rate on new bonds? Do not round
intermediate calculations. Round your answer to two decimal...

A firm's bonds have a maturity of 12 years with a $1,000 face
value, have an 11% semiannual coupon, are callable in 6 years at
$1,215, and currently sell at a price of $1,379.19.
What is their nominal yield to maturity? Do not round
intermediate calculations. Round your answer to two decimal
places.
What is their nominal yield to call? Do not round intermediate
calculations. Round your answer to two decimal places.
Lourdes Corporation's 12% coupon rate, semiannual payment,
$1,000...

- Nesmith Corporation's outstanding bonds have a $1,000 par
value, an 8% semiannual coupon, 9 years to maturity, and a 10% YTM.
What is the bond's price?
- A firm's bonds have a maturity of 10 years with a $1,000 face
value, have an 8% semiannual coupon, are callable in 5 years at
$1,054.06, and currently sell at a price of $1,105.17. What are
their nominal yield to maturity and their nominal yield to
call?

1.)
Last year Janet purchased a $1,000 face value corporate bond
with an 8% annual coupon rate and a 15-year maturity. At the time
of the purchase, it had an expected yield to maturity of 12.09%. If
Janet sold the bond today for $1,055.86, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.
2.)
Bond X is noncallable and has 20 years to maturity, a...

A 9% coupon rate, semiannual payment, $1,000 par value bonds
that mature in 25 years. Coupon payments are paid on January 01 and
July 01 every year. You purchased the bond on September 01 and
received an invoice price of $950. What is the quoted price on
September 01?

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