Question

You have just been offered a $1,000 par value bond for $847.88. The coupon rate is...

You have just been offered a $1,000 par value bond for $847.88. The coupon rate is 8 percent, payable annually, and yields to maturity on new issues of similar risk are 10 percent. You want to know how many more interest payments you will receive, but the party selling the bond cannot remember. Can you determine how many interest payments remain?

a. 14

b. 15

c. 12

d. 20

e. 10

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
You have just purchased a 10-year, $1,000 par value bond. The coupon rate on this bond...
You have just purchased a 10-year, $1,000 par value bond. The coupon rate on this bond is 6%, with interest being paid semi-annually. If you expect a 5% rate of return on this bond, how much did you pay for it? Show calculations.
You own a bond with a 5% coupon rate and $1,000 par value. Assume payments are...
You own a bond with a 5% coupon rate and $1,000 par value. Assume payments are made semi-annually and the bond matures in 20 years. The annual market interest rate is 9% percent. What is the value of the bond?
A 4.25 percent coupon bond with eight years left to maturity is offered for sale at...
A 4.25 percent coupon bond with eight years left to maturity is offered for sale at $983.36. What yield to maturity is the bond offering? (Assume interest payments are paid semi-annually and par value is $1,000.)
Calculate the current price of a $1,000 par value bond that has a coupon rate of...
Calculate the current price of a $1,000 par value bond that has a coupon rate of 18 percent, pays coupon interest annually, has 21 years remaining to maturity, and has a current yield to maturity (discount rate) of 7 percent
Calculate the current price of a $1,000 par value bond that has a coupon rate of...
Calculate the current price of a $1,000 par value bond that has a coupon rate of 7 percent, pays coupon interest annually, has 18 years remaining to maturity, and has a current yield to maturity (discount rate) of 15 percent.
Bond par value:                         $1,000               &nbs
Bond par value:                         $1,000                          Coupon interest rate:                10% Market interest rate:                 10⅞%                           Time to maturity:                      5 years (1):            What is the bond price when interest payments are paid annually? (2):            Municipal bonds receive special tax treatment. What is this special tax treatment and why is it applied to municipal bonds only? (25 word limit)
A.Bond Prices A $1,000 par bond that pays interest semiannually has a quoted coupon rate of...
A.Bond Prices A $1,000 par bond that pays interest semiannually has a quoted coupon rate of 7%, a promised yield to maturity of 7.7% and exactly 6 years to maturity. What is the bond's current value? B.Bond Prices A $1,000 par bond that pays interest semiannually has a quoted coupon rate of 5%, a promised yield to maturity of 5.7% and exactly 11 years to maturity. The present value of the coupon stream represents ______ of the total bond's value....
What is the value of a bond that has a par value of $1,000, a coupon...
What is the value of a bond that has a par value of $1,000, a coupon rate of 8.85 percent (paid annually), and that matures in 10 years? Assume a required rate of return on this bond is 9.02 percent. Fresh Water, Inc. sold an issue of 13-year $1,000 par value bonds to the public. The bonds have a 8.17 percent coupon rate and pay interest annually. The current market rate of interest on the Fresh Water, Inc. bonds is...
Calculate the current price of a $1,000 par value bond that has a coupon rate of...
Calculate the current price of a $1,000 par value bond that has a coupon rate of 9 percent, pays coupon interest annually, has 14 years remaining to maturity, and has a current yield to maturity (discount rate) of 15 percent. (Round your answer to 2 decimal places and record without dollar sign or commas).
You purchased a $1,000 par value 20-year 4% coupon bond with semi-annual payments for $1,000. Immediately...
You purchased a $1,000 par value 20-year 4% coupon bond with semi-annual payments for $1,000. Immediately after the purchase, interest rates increased and the yield to maturity and coupon reinvestment rate increased to 6%. (the coupons themselves stayed at 4%) Interest rates and the yield to maturity remain at 6% and you sell the bond 5 years later, having reinvested the coupons at 6%. How much is in your account (proceeds from bond sale and value of all coupons after...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT