XYZ issued CCC bonds two years ago at 12% YTM. Risk free rate is 8.7 percent...
XYZ issued CCC bonds two years ago at 12% YTM. Risk free rate is
8.7 percent at that time
The current risk premium on CCC bonds versus government bonds is
half of what it was two years ago. If risk free rate is 7.8 percent
now, what rate should be the YTM of XYZ bonds now?
-
8.45%
-
8.70%
-
9.45%
-
9.70%
-
9.95%
Homework Answers
Old Risk premium = 12 % - 8.7 %= 3.3%
New Risk premium = 3.3 % /2 = 1.65 %
YTM = 7.8% + 1.65% = 9.45%
Option 9.45%
Add Answer to:
XYZ issued CCC bonds two years ago at 12% YTM. Risk free rate is
8.7 percent...
Heginbotham Corp. issued 15-year bonds two years ago at a coupon rate of 8.8 percent. The...
Heginbotham Corp. issued 15-year bonds two years ago at a coupon rate of 8.8 percent. The bonds make semiannual payments. If these bonds currently sell for 109 percent of par value, what is the YTM?
West Corp. issued 20-year bonds two years ago at a coupon rate of 8.3 percent. The...
West Corp. issued 20-year bonds two years ago at a coupon rate of 8.3 percent. The bonds make semiannual payments. If these bonds currently sell for 104 percent of par value, what is the YTM? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) YTM %
West Corp. issued 10-year bonds two years ago at a coupon rate of 8.1 percent. The bonds make semiannual payments....
West Corp. issued 10-year bonds two years ago at a coupon rate of 8.1 percent. The bonds make semiannual payments. If these bonds currently sell for 102 percent of par value, what is the YTM? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) YTM = _______ %
West Corp. issued 20-year bonds two years ago at a coupon rate of 8.6 percent. The...
West Corp. issued 20-year bonds two years ago at a coupon rate of 8.6 percent. The bonds make semiannual payments. If these bonds currently sell for 107 percent of par value, what is the YTM? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Required Return If the risk-free rate is 8.7 percent and the market risk premium is 3.4...
Required Return If the risk-free rate is 8.7 percent and the market risk premium is 3.4 percent, what is the required return for the market?
Nine years ago the Templeton Company issued 22-year bonds with an 12% annual coupon rate at...
Nine years ago the Templeton Company issued 22-year bonds with an 12% annual coupon rate at their $1,000 par value. The bonds had an 8% call premium, with 5 years of call protection. Today Templeton called the bonds. Compute the realized rate of return for an investor who purchased the bonds when they were issued and held them until they were called. Round your answer to two decimal places. % Why the investor should or should not be happy that...
Skolits Corp. issued 20-year bonds 2 years ago at a coupon rate of 7.4 percent. The...
Skolits Corp. issued 20-year bonds 2 years ago at a coupon rate of 7.4 percent. The bonds make semiannual payments. If these bonds currently sell for 104 percent of par value, what is the YTM?
Bond Yields: Skolits Corp. issued 15-year bonds two years ago at a coupon rate of 5.1...
Bond Yields: Skolits Corp. issued 15-year bonds two years ago at a coupon rate of 5.1 percent. The bonds make semiannual payments. If these bonds currently sell for 105 percent of par value, what is the YTM?
Bond Yields (LO2] Heginbotham Corp. issued 20-year bonds two years ago at a coupon rate of...
Bond Yields (LO2] Heginbotham Corp. issued 20-year bonds two years ago at a coupon rate of 5.3 percent. The bonds make semiannual payments. If these bonds currently sell for 105 percent of par value, what is the YTM?
7.8 Ten years ago the Templeton Company issued 25-year bonds with a 9% annual coupon rate...
7.8 Ten years ago the Templeton Company issued 25-year bonds with a 9% annual coupon rate at their $1,000 par value. The bonds had a 6% call premium, with 5 years of call protection. Today Templeton called the bonds. Compute the realized rate of return for an investor who purchased the bonds when they were issued and held them until they were called. Round your answer to two decimal places. % Why should or should not the investor be happy...
West Corp. issued 20-year bonds two years ago at a coupon rate of 8.3 percent. The bonds make semiannual payments. If these bonds currently sell for 104 percent of par value, what is the YTM? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) YTM %
West Corp. issued 10-year bonds two years ago at a coupon rate of 8.1 percent. The bonds make semiannual payments. If these bonds currently sell for 102 percent of par value, what is the YTM? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) YTM = _______ %
Bond Yields: Skolits Corp. issued 15-year bonds two years ago at a coupon rate of 5.1 percent. The bonds make semiannual payments. If these bonds currently sell for 105 percent of par value, what is the YTM?
Bond Yields (LO2] Heginbotham Corp. issued 20-year bonds two years ago at a coupon rate of 5.3 percent. The bonds make semiannual payments. If these bonds currently sell for 105 percent of par value, what is the YTM?
Most questions answered within 3 hours.
-
please show all work and explain answers for all parts.
a) You own a portfolio that...
asked 12 minutes ago -
1. A researcher was attempting to quantify the amount of
dichlorodiphenyltrichloroethane (DDT) in spinach using gas...
asked 13 minutes ago -
A 2.0 kg block of -5.0° C ice is sitting on a surface with
negligible conductivity....
asked 17 minutes ago -
Pick a PowerShell command and elaborate on how it can be used in
a Server 2016...
asked 34 minutes ago -
using this struct create the following function using this
prototype
int searching(struct data*);
which searches for...
asked 37 minutes ago -
In a market for dry cleaning, the inverse market demand function
is given by P =...
asked 39 minutes ago -
An investment has the following cash flows. Should the project
be accepted if it has been...
asked 42 minutes ago -
A satellite used in a cellular telephone network has a mass of
2180 kg and is...
asked 52 minutes ago -
Prepare an annual operating budget for Troy Shoes based on this
information. Show a gross profit...
asked 57 minutes ago -
Zuniga, Inc. uses a process costing system. During May, 1,200
units were transferred into Department 2...
asked 1 hour ago -
What is the molarity of a 10% aqueous sodium hydroxide solution?
Enter only the number with...
asked 1 hour ago -
What are some of your organisation’s policies and procedures for
customer service including handling customer complaints?...
asked 1 hour ago