Question

A 30-year maturity bond with face value of $1,000 makes semiannual coupon payments and has a...

A 30-year maturity bond with face value of $1,000 makes semiannual coupon payments and has a coupon rate of 9.2%. (Do not round intermediate calculations. Enter your answers as a percent rounded to 3 decimal places.)

a. What is the yield to maturity if the bond is selling for $960?
  Yield to maturity %  
b. What is the yield to maturity if the bond is selling for $1,000?
  Yield to maturity %  
c. What is the yield to maturity if the bond is selling for $1,080?
  Yield to maturity %  

Homework Answers

Answer #1

Bond Par Value = $1,000

Time to maturity = 30 years

Coupon Rate = 9.2% semi-annually

a.

Bond Price = $960

Calculating YTM of Bond,

Using TVM Calculation,

I = [FV = 1000, PV = 960, T = 60, PMT = 46]

YTM = 9.52%

b.

Bond Price = $1000

Calculating YTM of Bond,

Using TVM Calculation,

I = [FV = 1000, PV = 1000, T = 60, PMT = 46]

YTM = 9.2%

c.

Bond Price = $1080

Calculating YTM of Bond,

Using TVM Calculation,

I = [FV = 1000, PV = 1080, T = 60, PMT = 46]

YTM = 8.59%

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
A 25-year maturity bond with face value of $1,000 makes annual coupon payments and has a...
A 25-year maturity bond with face value of $1,000 makes annual coupon payments and has a coupon rate of 8.1%. (Do not round intermediate calculations. Enter your answers as a percent rounded to 3 decimal places.) a. What is the bond’s yield to maturity if the bond is selling for $910? b. What is the bond’s yield to maturity if the bond is selling for $1,000? c. What is the bond’s yield to maturity if the bond is selling for...
A 20-year maturity bond with face value of $1,000 makes annual coupon payments and has a...
A 20-year maturity bond with face value of $1,000 makes annual coupon payments and has a coupon rate of 8.8%. (Do not round intermediate calculations. Enter your answers as a percent rounded to 3 decimal places.) a. What is the bond’s yield to maturity if the bond is selling for $980? b. What is the bond’s yield to maturity if the bond is selling for $1,000? c. What is the bond’s yield to maturity if the bond is selling for...
A 25-year maturity bond with par value $1,000 makes semiannual coupon payments at a coupon rate...
A 25-year maturity bond with par value $1,000 makes semiannual coupon payments at a coupon rate of 8%. a. Find the bond equivalent and effective annual yield to maturity of the bond if the bond price is $950. (Round your intermediate calculations to 4 decimal places. Round your answers to 2 decimal places.) Bond equivalent yield to maturity % Effective annual yield to maturity %
A bond with a face value of $1,000 has 10 years until maturity, carries a coupon...
A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 8.8%, and sells for $1,120. Interest is paid annually. (Assume a face value of $1,000 and annual coupon payments.) a. If the bond has a yield to maturity of 9.2% 1 year from now, what will its price be at that time? (Do not round intermediate calculations. Round your answer to nearest whole number.) b. What will be the rate of return...
A bond with a face value of $1,000 has 14 years until maturity, carries a coupon...
A bond with a face value of $1,000 has 14 years until maturity, carries a coupon rate of 8.6%, and sells for $1,104. a. What is the current yield on the bond? (Enter your answer as a percent rounded to 2 decimal places.) b. What is the yield to maturity if interest is paid once a year? (Do not round intermediate calculations. Enter your answer as a percent rounded to 4 decimal places.) c. What is the yield to maturity...
A bond with a face value of $1,000 has 10 years until maturity, carries a coupon...
A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 7.4%, and sells for $1,160. Interest is paid annually. (Assume a face value of $1,000 and annual coupon payments.) a. If the bond has a yield to maturity of 10.6% 1 year from now, what will its price be at that time? (Do not round intermediate calculations. Round your answer to nearest whole number.) b. What will be the rate of return...
Bond A has a face value of $1,000, makes semiannual coupon payments of $30 and will...
Bond A has a face value of $1,000, makes semiannual coupon payments of $30 and will mature in 7 years. It currently sells for $949.63. Bond B is a corporate bond whose price is quoted at 109.98 this afternoon. It will mature in exactly 15 years. Bonds A and B are priced so that they each have the same yield. What is the YTM for these two bonds, and what is the coupon rate for Bond B?
a. Find the duration of a 6% coupon bond making annual coupon payments if it has...
a. Find the duration of a 6% coupon bond making annual coupon payments if it has three years until maturity and has a yield to maturity of 6%. Note: The face value of the bond is $1,000. (Do not round intermediate calculations. Round your answers to 3 decimal places.) b. What is the duration if the yield to maturity is 10%? Note: The face value of the bond is $1,000. (Do not round intermediate calculations. Round your answers to 3...
A bond with a face value of $1,000 has 10 years until maturity, carries a coupon...
A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 7.9%, and sells for $1,110. Interest is paid annually. a. If the bond has a yield to maturity of 10.1% 1 year from now, what will its price be at that time? (Do not round intermediate calculations. Round your anser to nearest whole number.) b. What will be the annual rate of return on the bond? (Do not round intermediate calculations. Enter...
A 7% semiannual coupon bond matures in 5 years. The bond has a face value of...
A 7% semiannual coupon bond matures in 5 years. The bond has a face value of $1,000 and a current yield of 7.4352%. a. What is the bond's price? Do not round intermediate calculations. Round your answer to the nearest cent. b. What is the bond's YTM? Do not round intermediate calculations. Round your answers to two decimal places.