Question

Ailerone, Inc. has issued a bond with the following characteristics:

Par Value |
1,000 |

Settlement date | 1/1/2000 |

Maturity date | 1/1/2015 |

Annual coupon rate | 11.00% |

Coupons per year | 2 |

Yield to maturity | 12% |

What is the price of the bond?

$931.18

$657.50

$30.00

$734.56

Answer #1

Par Value = $ 1000, Tenure = Maturity Date - Settlement Date = 1/1/2015 - 1/1/2000 = 15 years or 30 half-years, Annual Coupon Rate = 11 % payable semi-annually (twice a year) and Yield to Maturity = 12 % per annum or (12/2) = 6 per half-year.

Semi-Annual Coupon Paid = 0.5 x 0.11 x 1000 = $ 55

Therefore, Bond Price = Sum of Present Values of All Semi-Annual Coupon Payments + Par Value Redeemed at Maturity = 55 x (1/0.06) x [1-{1/(1.06)^(30)}] + 1000 / (1.06)^(30) = $ 931.1758 ~ $ 931.18

Hence, the correct option is **(a)**

Par Value
1,000
Settlement date
1/1/2000
Maturity date
1/1/2015
Annual coupon rate
7.00%
Coupons per year
2
Yield to maturity
7%

Par Value
1,000
Settlement date
1/1/2000
Maturity date
1/1/2015
Annual coupon rate
8.00%
Coupons per year
2
Yield to maturity
9%

Settlement date
1/1/2000
Maturity date
1/1/2015
Annual coupon rate
7.00%
Coupons per year
2
a)
Yield to maturity
8%
b)
Yield to maturity
10%
c)
Yield to maturity
12%
calculate the price of the bond

Consider the following bond issued by
Walmart: coupon rate: 4.828% face value: $1,000 maturity date:
July 15, 2040 semi-annual coupons settlement date: March 8, 2020
yield (YTM): 4.164% most recent coupon payment date: January 15,
2020
What is the value of the bond? (Equivalently, we are calculating
the “dirty price”.) Express your answer as the dollar and cents
price for a bond with $1,000 face value.

Valuing Bonds?Microhard has issued a bond with the following
characteristics: Par: $1,000 Time to maturity: 23 years Coupon
rate: 7 percent Semiannual payments Calculate the price of this
bond if the YTM is 7 percent: ( I need to following
information)
Settlement
Maturity
Rate
YTM
Redemption
Frequency
Basis
Bond Price
Multiply by 10

Microhard has issued a bond with the following characteristics.
Par $1,000
Time to maturity 20 years
Coupon rate 7%
Semi-annual payments
Calculate the price of this bond if the YTM is
7%
9%
5%

Consolidated Cardboard, Inc. issued a 15-year, $1,000 par value
bond with a coupon rate of 9%. The current yield to maturity on
similar bonds is 11%. Calculate the price of Cardboard’s bond.

Microhard has issued a bond with the following
characteristics:
Par: $1,000
Time to maturity: 10 years
Coupon rate: 13 percent
Semiannual payments
Calculate the price of this bond if the YTM is
1. 13%
2. 15.%
3. 11%

1. Today, a bond has a coupon rate of 8.18 percent, par value of
1,000 dollars, YTM of 6 percent, and semi-annual coupons with the
next coupon due in 6 months. One year ago, the bond’s price was
1,022.04 dollars and the bond had 19 years until maturity. What is
the current yield of the bond today? Answer as a rate in decimal
format so that 12.34% would be entered as .1234 and 0.98% would be
entered as .0098.
2....

Yes They May, Inc. has a bond issue outstanding with a $1,000
par value and a maturity of 31 years. The bonds have an annual
coupon rate of 16.0% with semi-annual coupon payments. The current
market price for the bonds is $1,090. The bonds may be called in 3
years for 116.0% of par. What is the quoted annual
yield-to-maturity for the bonds?

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