Jay purchased a Treasury bond with a coupon rate of 3.72% and face value of $100. The maturity date of the bond is 15 March 2029. (b) In fact, Yuri changes his plan and Jay plans to sell this bond on 5 January 2022. What was Jay's sale price (rounded to four decimal places)? Assume a yield of 4.43% p.a. compounded half-yearly. Question 6Answer a. 94.9701 b. 94.7167 c. 96.8146 d. 96.5612
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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?Loïc is planning to purchase a Treasury bond paying a (j2) coupon rate of 4.94% p.a. The face value of the bond is $100. Its maturity date is 15 March 2033; the bond matures at par. If Loïc purchased this bond on 8 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 9.32% p.a., compounded half-yearly. Loïc needs to pay 11.1% of coupon payments and capital gains in tax. Assume that all tax payments are delayed by a half-year.Iolanda purchased a Treasury bond with a coupon rate of 4.59% and face value of $100. The maturity date of the bond is 15 April 2029. (a) Luciana plans to purchase Iolanda's Treasury bond on 12 April 2018. What price will Luciana pay (rounded to four decimal places)? Assume a yield of 2.54% p.a. compounded half-yearly. a. 119.5663 b. 119.5414 c. 119.5404 d. 118.7648
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- Hercules bought an Australian Treasury bond with a coupon rate of j2 = 4.17% p.a. and a face value of $100. The maturity date of the bond is 15 May 2033. If Hercules purchased this bond on 4 May 2018, what was his purchase price (rounded to four decimal places)? Assume a purchase yield of j2 = 4.72% p.a. a. 94.0019 b. 96.0839 c. 96.2203 d. 96.0862Alvin has bought a bond from Company ABC at RM1,020 in year 2020. The face value of the bond is RM1,000 with the coupon rate of 5%. One year later, Alvin liquidated the bond with the price of RM1,100. Calculate the expected return of the corporate bond.Today is 1 July 2021, William plans to purchase a corporate bond with a coupon rate of j2 = 3.65% p.a. and face value of 100. This corporate bond matures at par. The maturity date is 1 January 2024. The yield rate is assumed to be j2 = 4.5% p.a. Assume that this corporate bond has a 9.6% chance of default in any six-month period during the term of the bond. Assume also that, if default occurs, William will receive no further payments at all. Calculate the purchase price for 1 unit of this corporate bond. Round your answer to three decimal places. a.99.016 b.97.191 c.55.030 d.60.418
- On 5th December 2020, Jerome purchases a government bond worth $400, with a maturity of 3 years, face value of $500, and a coupon rate of 5% paid annually. The first coupon payment will be received a year from now (i.e., on 5th December, 2021). The yield to maturity offered by equally risky bonds is currently 7%. Such a yield to maturity stays constant over the next two years. On 5th December 2022, Jerome decides to sell this bond after receiving the second coupon payment. It turns out that, on that day, the new yield to maturity offered by equally risky bonds is 1.5%. At what price will Jerome be able to sell his bond?Last year, Sally purchased a $1,000 face value corporate bond with an 11.2 percent annual coupon rate and a 12-year maturity. At the time of the purchase, it had an expected yield to maturity of 11.9 percent. If Sally sold the bond today for $949.88, what rate of return would she have earned for the past year? a. 11.02% b. 11.20% c. 11.10% d. –0.69% e. 10.51%Giuseppe is planning to purchase an Australian Treasury bond with a coupon rate (j2) of 2.68% and face value of $100. The maturity date of the bond is 15 May 2033. If Giuseppe purchased this bond on 2 May 2018, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 1.94% p.a. compounded half-yearly, allowing for taxation. Giuseppe needs to pay tax at rate 21.9% on coupon payments. Assume the tax on coupon is paid immediately on the coupon payment date. a. 101.9133 b. 102.9603 c. 102.9591 d. 102.9019