Question

The market price is $585 for a 10-year bond ($1,000 par value) that pays 8 % annual interest, but makes interest payments on a semiannual basis (4% semiannually). What is the bond’s yield to maturity?

*Clearly show which EQUATIONS could be used to solve the
problem mathematically*

*Indicate the detailed steps on how to use FINANCIAL
CALCULATOR or Equations from the Textbook to solve the
problems.*

Answer #1

Information provided:

Par value= future value=$1000

Current price= $585

Coupon rate= 8%/2= 4%

Coupon payment= 0.04*1,000= $40

Time= 10 years*2= 20 semi-annual periods

The yield to maturity is calculated by entering the below in a financial calculator:

FV= 1,000

PV= -585

PMT= 40

N= 20

Press the CPT key and I/Y to compute the yield to maturity.

The value obtained is 8.3318.

Therefore, the yield to maturity is 8.3318%*2= 16.6635%
**16.66%.**

In case of any query, kindly comment on the solution.

The market price is $543 for a 10-year bond ($1,000 par value)
that pays 8 % annual interest, but makes interest payments on a
semiannual basis (4% semiannually). What is the bond’s yield to
maturity?

The market price is $1,050 for a 9 -year bond ($1,000 par value)
that pays 9 percent annual interest, but makes interest payments on
a semiannual basis (4.5 percent semiannually). What is the bond's
yield to maturity?

The market price is $775 for a 20-year bond ($1,000 par
value) that pays 11 percent annual interest, but makes interest
payments on a semiannual basis (5.5 percent semiannually). What
is the bond's yield to maturity?
A. The bond's yield to maturity is (?) %.

The market price is $725 for a 12 -year bond ($1,000 par
value) that pays 12 percent annual interest, but makes interest
payments on a semiannual basis (6 percent semiannually). What is
the bond's yield to maturity?
The bond's yield to maturity is?.
(Round to two decimal places.)

??(Yield to?
maturity)?The market price is $ 700 for a 10 year
bond ($1,000 par value) that pays 9 percent annual interest, but
makes interest payments on a semiannual basis
?(4.5 percent semiannually). What is the? bond's yield to?
maturity?
The? bond's yield to maturity is___% (Round to two decimal
places.)

The market price is $725 for a 14-year bond ($1000 par
value) that pays 11 percent annual interest, but makes interest
payments on a semiannual basis (5.5 percent semiannually). What
is the bond's yield to maturity?

You just purchased a $1,000 par value, 10-year, 9.3 percent
annual coupon bond that pays interest on a semiannual basis. The
bond sells for $974. What is the bond’s nominal yield to maturity
(enter answer as a percentage)?

(Related to Checkpoint 9.2) (Yield to maturity) The market
price is $750 for a 17-year bond ($1,000 par value) that pays
12 percent annual interest, but makes interest payments on a
semiannual basis (6 percent semiannually). What is the bond's
yield to maturity?

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....

A bond's current dollar price is $1,000, the same as its par
value. The bond has 20 years to maturity and a 6% coupon rate. The
bond makes semiannual coupon payments. What is the bond’s yield to
maturity?

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 3 minutes ago

asked 3 minutes ago

asked 14 minutes ago

asked 44 minutes ago

asked 46 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

asked 1 hour ago