Question

1.

What is the price of a bond with the following features?

Face Value = $1,000

Coupon Rate = 7% (stated as an ANNUAL rate)

Semiannual coupon payments

Maturity = 7 years

YTM = 6.34% (Stated as an APR)

State your answer to the nearest penny (e.g., 984.25)

2.

Assume you buy a bond with the following features

Bond maturity = 4

Coupon Rate = 5%

Face Value = $1,000

Annual Coupons

When you buy the bond the market interest rate = 4.36%

Immediately after you buy the bond the interest rate changes to
6.96%

What is the "reinvestment" effect in year 3 ?

Answer #2

answered by: anonymous

What is the price of a bond with the following features? Face
Value = $1,000 Coupon Rate = 7% (stated as an ANNUAL rate)
Semiannual coupon payments Maturity = 7 years YTM = 4.43% (Stated
as an APR) State your answer to the nearest penny (e.g.,
984.25)

1.What is the price of a bond with the following features?
Face Value = $1,000
Coupon Rate = 7% (stated as an ANNUAL rate)
Semiannual coupon payments
Maturity = 7 years
YTM = 6.34% (Stated as an APR)
State your answer to the nearest penny (e.g., 984.25)
2.
You own a bond with the following features:
Face value of $1000,
Coupon rate of 4% (annual)
11 years to maturity.
The bond is callable after 7 years with...

What is the price of a bond with the following features? Face
Value = $1,000 Coupon Rate = 4% (stated as an ANNUAL rate)
Semiannual coupon payments Maturity = 5 years YTM = 4.48% (Stated
as an APR) State your answer to the nearest penny (e.g.,
984.25)

What is the price of a
bond with the following features?
Face Value = $1,000
Coupon Rate = 2% (stated as an ANNUAL rate)
Semiannual coupon payments
Maturity = 5 years
YTM = 4.8% (Stated as an APR)
State your answer to
the nearest penny (e.g., 984.25)

What is the price of a bond with the following features?
Face Value = $1,000
Coupon Rate = 5% (stated as an ANNUAL rate)
Semiannual coupon
payments
Maturity = 9 years
YTM = 4.17% (Stated as an APR)
State your answer to the nearest penny (e.g., 984.25)

A.
You own a bond with the following features:
Face value of $1000, Coupon rate of 5% (annual) 8 years to
maturity. The bond is callable after 4 years with the call price of
$1,058.
If the market interest rate is 4.17% in 4 years when the bond
can be called, if the firm calls the bond, how much will it save or
lose by calling the bond? State your answer to the nearest penny
(e.g., 84.25). If there...

A.
You own a bond with the following features:
Face value of $1000,
Coupon rate of 5% (annual)
11 years to maturity.
The bond is callable after 6 years with the call price of
$1,056.
If the market interest rate is 4.71% in 6 years when the bond
can be called, if the firm calls the bond, how much will it save or
lose by calling the bond?
State your answer to the nearest penny (e.g., 84.25)...

1. Maturity (years) = 5 Face Value = $1,000 Coupon Rate = 3.00%
Price = $900 Coupon (Annual)
What is the YTM (annual) of the above bond?
A 5.38%
B 5.30%
C 5.33%
D 4.80%
E 5.36%
2. Consider a bond with the following features: Maturity = 7
years Face value = $1,000 Coupon rate = 4% Semiannual coupons Price
= $993
What is this bond's YTM stated as an annual rate?
A 3.2500%
B 4.1161%
C 2.0581%
D 6.500%

1.
Assume you buy a bond with the following features
Bond maturity = 4
Coupon Rate = 5%
Face Value = $1,000
Annual Coupons
When you buy the bond the market interest rate = 4.50%
Immediately after you buy the bond the interest rate changes to
6.71%
What is the "reinvestment" effect in year 3 ?
2.
Bond E has the following
features:
Face value =
$1,000, Coupon Rate =
10%,
Maturity = 5 years, Yearly coupons
...

Assume you buy a bond with the following features Bond maturity
= 4 Coupon Rate = 4% Face Value = $1,000 Annual Coupons When you
buy the bond the market interest rate = 4.22% Immediately after you
buy the bond the interest rate changes to 7.98% What is the
"reinvestment" effect in year 3 ?

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