Question

Suppose you purchase a zero-coupon bond (coupon = 0%) with a face value of $1,000 and a maturity of 25 years, for $200. If the yield to maturity on the bond remains unchanged, what will the price of the bond be 5 years from now?

$800.00

$253.64

$297.58

$275.95

$267.52

Answer #1

Suppose you purchase a zero-coupon bond with a face value
$1,000, maturing in 16 years, for $670. If the yield to maturity on
the bond remains unchanged, what will be the price of the bond 5
years from now?
Question 15 options:
$759
$778
$797
$816
$835

Suppose you purchase a zero coupon bond with a face value of
$1,000, maturing in 18years, for $214.10. Zero coupon bonds pay
the investor the face value on the maturity date. What is the
implicit interest in the first year of the bond's life?

Suppose you purchase a zero coupon bond with a face value of
$1,000, maturing in 21 years, for $215.00. Zero coupon bonds
pay the investor the face value on the maturity date. What is the
implicit interest in the first year of the bond's life?
The implicit interest in the first year of the bond's life is
? (Round to the nearest cent.)

Suppose you purchase a zero coupon bond with a face value of
$1,000, maturing in 20 years, for $214.55. Zero coupon bonds pay
the investor the face value on the maturity date. What is the
implicit interest in the first year of the bond's life? The
implicit interest in the first year of the bond's life is
_________. (Round to the nearest cent.)

A ten-year zero coupon bond with a face value of $1,000 is
currently priced at 48.72% of the face value. Assume the bond's YTM
remains unchanged throughout the bond's term to maturity. What
should the bond be sold for three years from now?
please explain in detail... if you use financial calculator
please label steps :)

You bought a 10-year zero-coupon bond with a face value of
$1,000 and a yield to maturity of 2.7% (EAR). You keep the bond for
5 years before selling it. The price of the bond today is P 0 = F (
1 + r ) T = 1,000 1.027 10 = 766.12
If the yield to maturity is still 2.7% when you sell the bond at
the end of year-5, what is your personal ANNUAL rate of return?

5. SupPose you buy a five-year zero-coupon Treasury bond for
$800 per $1,000 face value. Answer the following questions: (a)
What is the yield to maturity (annual compounding) on the bond? (b)
Assume the yield to maturity on comparable zeros increases to 7%
immediately after purchasing the bond and remains there. Calculate
your annual return (holding period yield) if you sell the bond
after one year. (c) Assume yields to maturity on comparable bonds
remain at7%, calculate your annual return...

You bought a 10-year
zero-coupon bond with a face value of $1,000 and a yield to
maturity of 3.4% (EAR). You keep the bond for 5 years before
selling it.
The price of the bond
today is P0=F(1+r)T=1,0001.03410=P0=F(1+r)T=1,0001.03410= 715.8
If the yield to
maturity is still 3.4% when you sell the bond at the end of year-5,
what is your personal annual rate of return?

A zero coupon bond, with a face value of $1,000, will mature in
15 years. The current yield to maturity for this bond is 10%. If
the yield to maturity drops by one percent, by what percentage will
the market price rise or fall?
a) +14.68%
b) +12.80%
c) +17.33%
d) -14.68%
e) -12.80%

a)You purchase a 3-year US government bond with a face value of
€1,000 and semi-annual coupon payments amounting to €25. The bond
will still make six coupon payments plus pay back the principal. If
the semi-annual yield to maturity is currently 5%, the present
value of this bond would be?
b) Computer stocks currently provide an expected rate of return
of 16%. MBI, a large computer company, will pay a year-end dividend
of €2 per share. If the stock is...

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