One hundred $1,000 bonds having bond rates of 8% per year payable annually are available for purchase. If you purchase them and keep them until they mature in 4 years, what is the maximum amount you should pay for the bonds if you wish to earn no less than a 7% effective annual return on yourinvestment?

Q: Twenty $1,000 municipal bonds are offered for sale at $18,680. The bond coupon rate is 6.8% per year…

A: Nominal yield rate of the bond is the annual yield to maturity. Hence, first semiannual yield to…

Q: Abner​ Corporation's bonds mature in 24 years and pay 15 percent interest annually. If you purchase…

A: Price of bond = $ 1050 Years to maturity = 24 Par value = $ 1000 Coupon rate = 15% Annual coupon…

Q: A mortgage bond issued by Automation Engineering is for sale for $8,700. The bond has a face value…

A: Introduction Yield To maturity: Simply means the rate of return the investors can expect on a bond…

Q: A $1,000 principal value bond costs $35 in quarterly interest and matures in ten years. How much…

A: 71c. $1,115.57

Q: A $5,000 bond is offered for sale. It has a stated interest rate of 7% paid ann end of 8 years, the…

A: Price of bond is sum of present value of the interest payment and present value of face value of…

Q: Twenty $1,000 municipal bonds are offered for sale at $18,000. The bond coupon rate is 6% per year…

A: Bonds are the fixed income securities that are issued when company needs to raise finance. It is…

Q: An investor purchases a bond 6 months after the issue. The bond will be redeemed at 105% eight years…

A: Price of a bond = present value of its future cashflows, let the purchase price be = P  Hence, P =…

Q: A well-known industrial firm has issued $990 bonds that carry 4% nominal annual interest paid…

A: Bonds refer to the financial instruments which are used by  the financial institutions  for raising…

Q: Ten bonds are purchased for $8.856.11 and are kept for 5 years. The bond coupon rate is 9% per year,…

A:

Q: A bond with a face value of $2,000 pays half-yearly interest at a rate of 8% pa compounded…

A: Bond compounding semi-annually: In this case, the bond has a face value of $ 2000 that pays…

Q: You have just purchased a municipal bond with a $10,000 par value for $9,500. You purchased it…

A: Given information: Par value of bond is $10,000 Purchase price is $9,500 Bond rate is 6.6% per year…

Q: A $3000 bond that pays 9%semi-annually is redeemable at par in 15 years. Calculate the purchase…

A: Solution:- We know, the purchase price of bond is the present value of amounts receivable from the…

Q: SOP Ltd bonds have a par value of $1,000. The bonds pay semi-annual interest of $40 and mature in 5…

A: Using Present value function in excel

Q: A $10,000 commercial bond that has a 6% bond rate and matures in 5 years can be purchased for…

A: A financial instrument with a fixed cost that helps a company to raise funds for business operations…

Q: A bond pays $1,500 at the end of each year for five years, plus an additional $2,000 when the bond…

A: Annual cash inflow = $ 1500 Maturity value = $ 2000 Years to maturity = 5 Years Annual interest rate…

Q: A $15,000, 5.5% bond is purchased 10.5 years before maturity to yield 8% compounded annually. If the…

A: Bond is a debt instrument issued by companies and government. It is a fixed income instrument which…

Q: Stacy purchases a $60,000 bond for $57,500. The coupon rate is 6% per year payable quarterly. The…

A: The present worth of the bond will be the present value of the coupon and principal payments.

Q: A 20-year bond with a face value of P 5,000 is offered for sale at P 3,800. The nominal rate of…

A: Bonds are one of the most traded financial asset in the financial market. It is demanded by the…

Q: A man purchases a bond for $900. The bond has a face value of $1,000 and pays semi-annual interest…

A: Bond price = $ 900 Par value = $ 1000 Semi annual coupon payment amount = $ 50 Period = 10 Years…

Q: Ten bonds are purchased for $ 9,340.69 and are kept for 5 years. The bond coupon rate is 6% per…

A: Given 10 bonds are purchased for 9340.69 and the face value of bonds should to be calculated. Let…

Q: Compute the specified quantity.A 4-year bond costs $20,000 and will pay a total of $2,800 in…

A: The total amount of interest is $2,800.The cost of bond is $20,000.Number of years is 4.The annual…

Q: A man wants to make 14% nominal interest compounded semi - annually on a bond investment. How much…

A: Here we asked to find the bond price given a specific yield (14%). We can do this by using the time…

Q: What is its annual interest rate r (as a percent)?

A: A bond is a debt instrument with which a shareholder credits cash to an entity, which can be a…

Q: The bond paid $150 per year in coupon interest on the last day of each year (the last payment made…

A: Given information :

Q: Assume a $1000 bond issue at the rate of 10% for 15 years. a)What is the interest payment for this…

A: Bond carry annual payment which are paid during the life of bonds.

Q: A bond with a face value of ​$5,000 pays quarterly interest of 4 percent each period. Twenty…

A: Quarterly coupon (C) = 4% of $5000 = $200 First coupon payment is due now, hence n = 19 r = 8% per…

Q: The duration of a soon to be approved loan of $8 million is four years. The 99th percentile increase…

A: Loan Risk: A borrower's inability to pay back a loan or satisfy other contractual commitments is a…

Q: You own a $50,000 corporate bond with a bond interest rate of 6% payable monthly that is due 10…

A: The selling price will be limited to the present value of the future cash flows from the bond.

Q: A $10,000 mortgage bond with a bond interest rate of 8% per year, payable quarterly, was purchased…

A: Payment is made quarterly. So number of periods = 7*4 = 28 Coupon rate per year = 8% Coupon rate per…

Q: You intend to purchase a 10-year, $1,000 face value bond that pays interest of $60 every 6 months.…

A: The price of the bond shall be the present value of face value of the bond and semi annual coupons…

Q: Seaside issues a bond with a stated interest rate of 12%, the face value of $40,000, and due in 8…

A: The bonds are issued at discount when market rate is higher than the coupon rate of bonds payable.

Q: A bond promises to pay you $7,000.00 in 10 years. If you are able to earn 6 percent on securities of…

A: Present Value can be calculated using PV function in excel   PV (rate, nper, pmt, [Fv], [type])…

Q: The Saleemi​ Corporation's ​$1,000 bonds pay 5 percent interest annually and have 13 years until…

A: Bonds are long-term financing debt. It is a company that raises funds for its business. In return, a…

Q: 6) per year compounded quarterly. If John wishes to earn 8% per year compounded quarterly on the…

A: The question is based on the concept of valuation of bond with coupon payment. Formula as,  V=…

Q: corporation’s bonds mature in 23 years and pay 7 percent interest annually. If you purchase the…

A: The given problem can be solved using RATE function in excel. RATE function computes yield to…

Q: A 6-year bond costs $9,000 and will pay a total of $2,700 interest over its lifetime. What is its…

A: Cost of bond = $9,000 Timer period = 6 years Total interest = $2,700

Q: Ten bonds are purchased for $9,598.13 and are kept for 5 years. The bond coupon rate is 7% per year,…

A: Purchase price of the bond is $9,598.13. Coupon rate 7% Yield is 9% term is 5 years

Q: One hundred $1,000 bonds having a bond rate of 8% per year payabie quarterly are purchased for…

A: The following formula will be used:

Q: Ten bonds are purchased for $9,083.25 and are kept for 5 years. The bond coupon rate is 5% per year,…

A: Ten bonds purchase price (P0) = $9083.25 Let the face value = F Total coupon for ten bonds (C) = 10…

Q: Rivera Inc. is considering the issuance of $500,000 face value, ten-year term bonds. The bonds will…

A: Bonds Payable: A bond is a debt instrument, and so it requires its issuing company to pay periodic…

Q: A $10,000 "serial" bond redeems portion of the outstanding principal randomly each year, in the…

A: Interest in 1st semester = (12%/2)*10,000 = 600 Total cashflow in 1st semester = 1000 + 600 = 1600…

Q: you intended to purchase a 10 year, $1,000 face value bond pays interestof $60 every 6 months if…

A: Computation of bond price Table values are based on: n= 20     i= 5.00%     Cash flow Table…

Q: You wish to purchase a $1,000 bond from a friend who needs the money. There are 7 years remaining…

A: Bond valuation is based on the present value of all future cash flows at a required rate of return.…

Q: The Saleemi​ Corporation's $1,000 bonds pay 6 percent interest annually and have 14 years until…

A: Par value (FV) = $ 1000 Coupon rate = 6% Coupon amount (C) = 1000*0.06 = $ 60 Years to maturity = 14…