Homework Answers
2-value of bond = (coupon payment*PVAF at 2.99%)+(face value*PVF at 2.99 %)
1150 = (coupon payment*12.5707)+(1000*.6241)
1150 = coupon payment*12.5707)+624.1
Semiannual coupon payment = 525.9/12.5707 = 41.8353
annual coupon payment = 41.8353*2 = 83.6707
Current Yield = coupon payment/market price = 83.6707/1150 = 7.28%
PVAF at 5.98% for 16 semiannual period =1-(1+r)^-n/ r = 1-(1.0299)^-16 /2.99% =12.5707
PVF at 2.99% at 16th semiannual period =1/(1.0299)^16 =.6241
1-
| Option is 3 | |||
| Price of 5 year bond =Using present value function in MS excel | pv(rate,nper,pmt,fv,type) rate = 3.7% pmt =27.5 nper = 10 fv =1000 type = 0 | PV(3.7%,9,-27.5,-1000,0) | $935.24 |
| change in price of 5 year bond | (current price-purchase price)/purchase price | (935.24-1000)/1000 | -6.48% |
| Price of 10 year bond =Using present value function in MS excel | pv(rate,nper,pmt,fv,type) rate = 3.7% pmt =27.5 nper = 20 fv =1000 type = 0 | PV(3.7%,20,-27.5,-1000,0) | $876.75 |
| change in price of 5 year bond | (current price-purchase price)/purchase price | (876.75-1000)/1000 | -12.33% |
Add Answer to:
z i TB MC Qu. 96 Last year, Forest Products issued both... Last year, Forest Products...
Last year, Forest Products issued both 5-year and 10-year bonds at par. The bonds each have...
Last year, Forest Products issued both 5-year and 10-year bonds at par. The bonds each have a coupon rate of 5.5 percent, paid semiannually, and a face value of $1,000. Assume the yield to maturity on each of these bonds is now 7.4 percent. What is the percentage change in the price of the 5-year bond since it was issued? The 10-year bond? Multiple Choice -3.39:-6.08 -6.48;-10.87 6.48;-12.33 -3.39,-577 ANext 3 of 10 Prev
TB MC Qu. 118 The... The 6.4 percent bond of Berberich, Inc. has a yield to...
TB MC Qu. 118 The... The 6.4 percent bond of Berberich, Inc. has a yield to maturity of 6.9 percent. The bond matures in eleven years, has a face value of $1,000, and pays semiannual interest payments. What is the amount of each coupon payment? 39 Multiple Choice $64.00 $32.00 $34.50 $69.00 <Prev 2 of 10 Mext>
I need help on this please. Question 9: One year ago, XYZ Co. issued 20-year bonds...
I need help on this please. Question 9: One year ago, XYZ Co. issued 20-year bonds at par. The bonds have a coupon rate of 6.48 percent, paid semiannually, and a face value of $1,000. Today, the market yield on these bonds is 6.8 percent. What is the percentage change in the bond price over the past year? Answer to two decimals
TB MC Qu. 01-85 Curtis invests... Curtis invests $700,000 in a city of Athens bond that...
TB MC Qu. 01-85 Curtis invests... Curtis invests $700,000 in a city of Athens bond that pays 9.25 percent interest. Alternatively, Curtis could have invested the $700,000 in a bond recently issued by Initech, Inc. that pays 11.00 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. points If Curtis invested in the Initech, Inc. bonds, what would be his after-tax rate of return from this investment? Multiple Choice...
Ten years ago, Simply Splendid Corp. issued 40 year bonds with a $1,000 face value and...
Ten years ago, Simply Splendid Corp. issued 40 year bonds with a $1,000 face value and a 7 percent coupon rate, paid semiannually. Bond of this risk currently have a yield to maturity of 9 percent. How much would you expect to pay for one of these bonds today? Harley Group has outstanding $1,000 face value bonds that have a 6.5 percent coupon rate, paid semiannually, and mature in 18 years. They are currently selling for $935.15. What is their...
25 years ago, Delicious Mills, Inc. issued 30-year to maturity bonds that had a 8.16 percent...
25 years ago, Delicious Mills, Inc. issued 30-year to maturity bonds that had a 8.16 percent annual coupon rate, paid semiannually. The bonds had a $1,000 face value. Since then, interest rates in general have changed and the yield to maturity on the Delicious Mills bonds is now 10.48 percent. Given this information, what is the price today for a Delicious Mills bond?
I need help on these questions. Question 5. Linville Corporation issued 15-year, par $1,000 bonds ten...
I need help on these questions.
Question 5. Linville Corporation issued 15-year, par $1,000 bonds ten years ago at a coupon rate of 5 percent. The bonds make semi-annual payments. If these bonds currently sell for 90 percent of par value, what is its yield to maturity (YTM)? Question 6. Pecos Company has just issued a 10-year, 10 percent coupon rate, $1,000- par bond that pays interest semiannually. Three years later, if the going rate of interest on the bond...
One year ago, Alpha Supply issued 15-year bonds at par. The bonds have a coupon rate...
One year ago, Alpha Supply issued 15-year bonds at par. The bonds have a coupon rate of 6.5 percent, paid semiannually, and a face value of $1,000. Today, the market yield on these bonds is 7.2 percent. What is the percentage change in the bond price over the past year? 5.94 percent 5.38 percent -6.11 percent -5.87 percent The bond price did not change.
Weismann Co. issued 11-year bonds a year ago at a coupon rate of 10 percent. The...
Weismann Co. issued 11-year bonds a year ago at a coupon rate of 10 percent. The bonds make semiannual payments and have a par value of $1,000. If the YTM on these bonds is 10 percent, what is the current bond price? Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. Suppose a German company issues a bond with a par value of €1,000, 8 years to maturity,...
Atlantis Company issued bonds on January 1, 2006. The bonds had a coupon rate of 6.0%,...
Atlantis Company issued bonds on January 1, 2006. The bonds had a coupon rate of 6.0%, with interest paid semiannually. The face value of the bonds is $1,000 and the bonds mature on January 1, 2024. What is the yield to maturity for these bonds on January 1, 2019 if the market price of the bond on that date is $1,150? Submit your answer as a percentage and round to two decimal places. A $1,000 par value 8-year bond with...
Last year, Forest Products issued both 5-year and 10-year bonds at par. The bonds each have a coupon rate of 5.5 percent, paid semiannually, and a face value of $1,000. Assume the yield to maturity on each of these bonds is now 7.4 percent. What is the percentage change in the price of the 5-year bond since it was issued? The 10-year bond? Multiple Choice -3.39:-6.08 -6.48;-10.87 6.48;-12.33 -3.39,-577 ANext 3 of 10 Prev
TB MC Qu. 118 The... The 6.4 percent bond of Berberich, Inc. has a yield to maturity of 6.9 percent. The bond matures in eleven years, has a face value of $1,000, and pays semiannual interest payments. What is the amount of each coupon payment? 39 Multiple Choice $64.00 $32.00 $34.50 $69.00 <Prev 2 of 10 Mext>
TB MC Qu. 01-85 Curtis invests... Curtis invests $700,000 in a city of Athens bond that pays 9.25 percent interest. Alternatively, Curtis could have invested the $700,000 in a bond recently issued by Initech, Inc. that pays 11.00 percent interest with similar risk as the city of Athens bond. Assume that Curtis's marginal tax rate is 24 percent. points If Curtis invested in the Initech, Inc. bonds, what would be his after-tax rate of return from this investment? Multiple Choice...
I need help on these questions.
Question 5. Linville Corporation issued 15-year, par $1,000 bonds ten years ago at a coupon rate of 5 percent. The bonds make semi-annual payments. If these bonds currently sell for 90 percent of par value, what is its yield to maturity (YTM)? Question 6. Pecos Company has just issued a 10-year, 10 percent coupon rate, $1,000- par bond that pays interest semiannually. Three years later, if the going rate of interest on the bond...
Weismann Co. issued 11-year bonds a year ago at a coupon rate of 10 percent. The bonds make semiannual payments and have a par value of $1,000. If the YTM on these bonds is 10 percent, what is the current bond price? Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. Suppose a German company issues a bond with a par value of €1,000, 8 years to maturity,...
Most questions answered within 3 hours.
-
Where is the error in this code sequence?
String s1 = "Hello";
String s2 = "ello";...
asked 11 months ago -
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance...
asked 11 months ago -
Consider this reaction:
Al2(SO4)3 (aq)+ BaCl3
(aq) Al2Cl6 (aq)- +
3BaSO4(s) . What is the...
asked 11 months ago -
Suppose that Savneet is considering increasing her
recent random sample from 20 car rentals to 40...
asked 11 months ago -
Trucks arrive at an unloading terminal at an average rate of 120
per hour.
Trucks arrive...
asked 11 months ago -
Why are methanol and ethanol completely soluble in water while
octanol is not very little soluble....
asked 11 months ago -
A facilities manager at a university reads in a research report
that the mean amount of...
asked 11 months ago -
When the CuSO4 is rehydrated by adding water to the anhydrous
compound, is this an endothermic...
asked 11 months ago -
A ray of sunlight is passing from diamond into crown glass; the
angle of incidence is...
asked 11 months ago -
A block of mass 0.249 kg is placed on top of a light, vertical
spring of...
asked 11 months ago -
how do the kidneys compensate in the presences of acidosis
a) trigger hyperventilate
b) reserve acid...
asked 11 months ago -
Question 501 pts
The rental rate of capital to the firm increases. Which of the
following...
asked 11 months ago