Question

A $1,000 face value preferred share with an annual coupon of $60 is available on the market. What is the value of this preferred share if the relevant discount rate for valuation purposes is 7%? Select one:

a. $1,062.22 b. $1,000.00 c. $857.14 d. $796.73 e. None of the above

Answer #1

Ans c. $857.14

Value of Preferred Share = Annual dividend / Discount rate

= 60 / 7%

= $857.14

A $1,000 face value preferred share with an annual coupon of $60
is available on the market. What is the value of this preferred
share if the relevant discount rate for valuation purposes is
7%?
Select one:
a. $1,062.22
b. $1,000.00
c. $857.14
d. $796.73

1.A $1,000 face value preferred share with an annual coupon of
$60 is available on the market. What is the value of this preferred
share if the relevant discount rate for valuation purposes is
7%?
Select one:a. $1,062.22b. $1,000.00c. $857.14d. $796.73e. None
of the above

1. Maturity (years) = 5 Face Value = $1,000 Coupon Rate = 3.00%
Price = $900 Coupon (Annual)
What is the YTM (annual) of the above bond?
A 5.38%
B 5.30%
C 5.33%
D 4.80%
E 5.36%
2. Consider a bond with the following features: Maturity = 7
years Face value = $1,000 Coupon rate = 4% Semiannual coupons Price
= $993
What is this bond's YTM stated as an annual rate?
A 3.2500%
B 4.1161%
C 2.0581%
D 6.500%

An 8-year bond with a face value of $1,000 has a coupon of 4.56%
and the market is pricing the bond to yield 5.37%. This is a
________ bond. Group of answer choices
par
discount
premium
zero coupon
Kurt's Steel, Inc. offers a preferred stock with an annual
dividend of $3.00 per share. Investors currently require a return
of 6.15% on this preferred stock. What should be the current market
price of this preferred stock?
Group of answer choices
$39.75...

17.
Assume a semi-annual coupon bond matures in 3 years, has a
face value of $1,000, a current market price of $989, and a 5
percent coupon. Which one of the following statements is correct
concerning this bond?
A.
The current coupon rate is greater than 5 percent.
B.
The bond is a money market instrument.
C.
The bond will pay less annual interest now than when it was
originally issued.
D.
The current yield exceeds the coupon rate.
E....

Portland Brewery Inc. recently issued 30-year $1,000 face
value, 12% annual coupon bonds. The market discount rate for this
bond is only 7%. What is the current price of this bond?

Timmons Ltd. has 9% p.a. coupon rate bonds, with an annual
coupon, on the market with 8 years left to maturity. The yield to
maturity is 8% p.a. Assuming a face value of $1,000, what is the
bond's current price?
a.
$1,057.47
b.
$1,000.00
c.
$944.65
d.
$1,028.20
e.
$1,087.86

Suppose you bought a 15-year $1,000 face-value bond for $945 one
year ago. The annual coupon rate is 7% and interest payments are
paid annually. If the price today is $995, the yield to maturity
must have changed from _____________ to ______________.
8.12%; 6.94%
7.12%; 8.11%
7.63%; 7.06%
9.11%; 9.35%
None of the above

A bond pays an annual coupon on a face value of $1,000. The bond
is currently trading at $950 and its yield is 7%. I buy the bond
today and sell it immediately after I receive the next coupon one
year from now, at which time its yield is still 7%. If my capital
gain is 5%, then what is the bond's coupon rate?

PRICING ZERO COUPON BONDS -
(a) Calculate the price of a zero coupon, $1,000 face value,
5-year bond if the appropriate annual discount rate is 12 percent.
Calculate your total return if you hold this bond for three years
and the discount rate does not change. (INCLUDE FORMULAS USED TO
SOLVE PROBLEM IN EXCEL).
EXPECTED RETURN ON T-BILLS -
(b) What is the actual expected return on a US government
12-month, T-bill that is priced at $990, assuming its face...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 5 minutes ago

asked 8 minutes ago

asked 17 minutes ago

asked 36 minutes ago

asked 47 minutes ago

asked 53 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago