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A zera coupon bond with promised payment of $100 to be paid in 5 years has price equal to$80. What is the YTM?
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- Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for 1,135.90, producing a nominal yield to maturity of 8%. However, the bond can be called after 5 years for a price of 1,050. (1) What is the bonds nominal yield to call (YTC)? (2) If you bought this bond, do you think you would be more likely to earn the YTM or the YTC? Why?Yield to Maturity and Yield to Call Arnot International’s bonds have a current market price of $1,200. The bonds have an 11% annual coupon payment, a $1,000 face value, and 10 years left until maturity. The bonds may be called in 5 years at 109% of face value (call price = $1,090). What is the yield to maturity? What is the yield to call if they are called in 5 years? Which yield might investors expect to earn on these bonds, and why? The bond’s indenture indicates that the call provision gives the firm the right to call them at the end of each year beginning in Year 5. In Year 5, they may be called at 109% of face value, but in each of the next 4 years the call percentage will decline by 1 percentage point. Thus, in Year 6 they may be called at 108% of face value, in Year 7 they may be called at 107% of face value, and so on. If the yield curve is horizontal and interest rates remain at their current level, when is the latest that investors might expect the firm to call the bonds?Showing your calculations, calculate the price of a $100,000 debenture bond that matures in 15 years, with a stated rate of 5% a year in interest if you wanted to earn a yield of: a. 4%? b. 5%? c. 6%?
- What would be the price of 10 years bond with face value Rs 5000,coupon rate of 10% and required rate of 15%. Calculate the pricebut show the answer of each year separately?What is the market value of Beril Gıda A.Ş.'s bond with a nominal value of USD 12,000, maturity of 5 years and an annual interest payment of 25%, when the desired rate of return is 25%? a) 18000b) 15000c) 12000d) 16000e) 24000Show the complete solution and diagram. A bond with a par value of 2,500 and with a bond rate of 8% payable annually is to be redeemed at 2,650 at the end of 5 years from now. If it is sold now, what should be the selling price to yield 6%?
- A bond with a face value of $10,000 pays interest of 4% per year. This bond will be redeemed at its face value at the end of 10 years. How much should be paid now for this bond when the first interest payment is payable one year from now and a 5% yield is desired?Give typing answer with explanation and conclusion What is the coupon payment of a 4-year $1000 bond, 5% YTM, and with a 7.5% coupon rate and quarterly payments?How much will the coupon payments be of a 20 -year $500 bond with a 10% coupon rate and quarterly payments? A. $12.50 B. $4.17 C. $25.00 D. $50.00