Question

The price of a ten-year semi-annual pay bond with a par value of $1,000 and a 7 percent annual coupon and yield to maturity of 8.25 percent is closest to:

Answer #1

**The coupon payment is computed as follows:**

= 7% / 2 x $ 1,000 (Since the payments are semi annually, hence divided by 2)

**= $ 35**

**The YTM will be as follows:**

= 8.25% / 2 (Since the payments are semi annually, hence divided by 2)

**= 4.125% or 0.04125**

**N will be as follows:**

= 10 x 2 (Since the payments are semi annually, hence multiplied by 2)

**= 20**

**So, the price of the bond is computed as
follows:**

**Bonds Price = Coupon payment x [ [ (1 - 1 / (1 +
r)**^{n}**] / r ] + Par
value / (1 + r)**^{n}

= $ 35 x [ [ (1 - 1 / (1 + 0.04125)^{20} ] / 0.04125 ] +
$ 1,000 / 1.04125^{20}

= $ 35 x 13.44113095 + $ 445.5533483

**= $ 915.99 Approximately**

Feel free to ask in case of any query relating to this question

The price of a ten-year semi-annual pay bond with a par value of
$1,000 and a 7 percent annual coupon and yield to maturity of 8.25
percent is closest to: a) 1051.48 b) 900.23 c) 915.99 d) 949.60

The price of a ten-year semi-annual pay bond with a par value of
$1,000 and a 7 percent annual coupon and yield to maturity of 8.25
percent is closest to:please give step by step solutions!
915.99
1051.48
949.60
900.23

PART 2 - BOND CALCULATIONS
a) What is the price of a $1,000 par value, semi-annual coupon
bond with 16 years to maturity, a coupon rate of 5.40% and a
yield-to-maturity of 5.90%?
b) What is the price of a $1,000 par value, 10 year, annual
coupon bond with a 5.80% coupon rate and a yield to maturity of
5.50%
c) A 10-year, 6.30% semi-annual coupon bond today and the
current market rate of return is 5.60%. The bond is...

Assume a par value of $1,000. Caspian Sea plans to issue a 15.00
year, semi-annual pay bond that has a coupon rate of 7.85%. If the
yield to maturity for the bond is 8.45%, what will the price of the
bond be?

Assume a par value of $1,000. Caspian Sea plans to issue a 21.00
year, semi-annual pay bond that has a coupon rate of 4.00%. If the
yield to maturity for the bond is 4.0%, what will the price of the
bond be?
Answer format: Currency: Round to: 2
decimal places.

Q3) What is the price of a $1,000 par value, semi-annual coupon
bond with 15 years to maturity, a coupon rate of 03.60% and a
yield-to-maturity of 08.70%? (1 point)

Price the following:
12-year, $1000 par value, 6% semi-annual coupon bond whose
current nominal yield-to-maturity (YTM) is 8%.
10-year, $1000 par value, 8% quarterly coupon bond whose current
nominal YTM is 7%.
30-year, $1000 par value, zero-coupon bond whose current nominal
YTM is 9.5%.
13-year, $1000 par value, 8% monthly coupon bond whose current
nominal YTM is 10%.
5-year, $500 par value, 8% semi-annual coupon bond whose current
nominal YTM is 8.25%

Compute the price of a $1,000 par value, 12 percent (semi-annual
payment) coupon bond with 21 years remaining until maturity
assuming that the bond's yield to maturity is 14 percent? (Round
your answer to 2 decimal places and record your answer without
dollar sign or commas).

Compute the price of a $1,000 par value, 6 percent (semi-annual
payment) coupon bond with 24 years remaining until maturity
assuming that the bond's yield to maturity is 14 percent? (Round
your answer to 2 decimal places and record your answer without
dollar sign or commas).

Compute the price of a $1,000 par value, 9 percent (semi-annual
payment) coupon bond with 30 years remaining until maturity
assuming that the bond's yield to maturity is 18 percent? (Round
your answer to 2 decimal places and record your answer without
dollar sign or commas).

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