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1.Piotr buys a 10 year, $50,000.00 face value, r(2) = 1.500% coupon bond. The bond yield is j(365) = 7.750%. What is the price of the bond?
a. $29,563.60.
b. $28,155.81.
c. $30,126.72.
d. $29,282.04.
e. $28,437.37.
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Solved in 3 steps
- Suppose that a one-year, risk-free, zero-coupon bond with a $100,000 face value has an market price of $96,618.36. If you purchased this bond and held it to maturity, what is the yield-to-maturity on your bond? (Hint: use 4 decimal places for your calculations.) A. 1.50% B. 2.49% C. 4.49% D. 5.20% E. None of the above. 2.Devi pays $22,647.32 for a 5 year, $25,000.00 face value bond. The bond yield is j(4) = 8.125%. Find the coupon rate r(2) for the bond. a. 5.875% b. 5.750% C. 6.375% d. 6.250% e. 5.375%A bond that matures in one year has a $500 face value and a $60 coupon. What is the price of the bond if the interest rate is 6 percent and the bond was purchased by the present owner for $450? $103.77 $481.13 $528.30 $500.00
- You purchased a coupon-bearing bond at $800 and resold it at $900 after exactly one year. If the coupon is $60 paid annually, what is the current yield of the bond? O A. 0.075 O B. 0.125 O C. 0.067 O D. 0.200Suppose you want to purchase a bond with a $1,000 par value maturing in 4 years with an 8% annual coupon interest rate, and has a market interest rate of 6%. What's the price or the value of this bond? Select one: O a. $1,069.31 O b. $9712 O c. $1,000 7 O d. 927.66A bond promises to pay you $7,000.00 in 10 years. If you are able to earn 6 percent on securities of equal risks, what would be the present value of the Bond? (to the nearest dollar) Select one: O a. $4,200 O b. $3,589 Oc. $3,727.00 O d. $3,909 A bond will sell at if the required return is greater than the coupon rate.
- 1. If you invest in a $1,000 bond and pay a price of $832, and the coupon rate on the bond is 4%, what is your “Current Yield” on your investment?:a. It is 4.81%. b. 5.67%c. 3.21%d. 4.29%1.What is the holding period yield for an investor who pays $1,145 for a bond with a $1,000 face value and a 5% coupon and sells the bond three years later for $1,420???? a. 5.00% b. 6.86% c. 11.52% d. 3.78%You purchased a coupon-bearing bond at $1000 and resold it at $1200 after exactly one year. If the coupon is $60 paid annually, what is the current yield of the bond? OA 0.060 O B. 0.050 OC. 0.200 O D. 0.26
- You purchase a bond with an invoice price of $1,320. The bond has a coupon rate of 4.4 percent, and there are 4 months to the next semiannual coupon date. What is the clean price of the bond? Assume a par value of $1,000. Multiple Choice O о о O $1,270.67 $1,305.43 $1,312.67 $1,323.67 $1,285.33a)You purchased an annual interest coupon bond one year ago that now has six years remaining until maturity. The coupon rate of interest was 10% and par value was $1,000. What was the intrinsic value of the bond at the time you purchased it if the yield to maturity was 8%? a.$1,057.50.b.$1,075.50.c.$1,088.50.d.$1,104.13. b) River Co. just paid a dividend of $2 per share out of earnings of $4 per share. If its book value per share is $25 and its stock is currently selling for $40 per share, calculate the required rate of return on the stock. a.15.2 percentb.7.2 percentc.14.7 percentd.13.4 percentAn investor just purchased a 10-year, $1,000 par value bond. The coupon rate on this bond is 5 percent with interest being paid semiannually. If the investor expects to earn an 8 percent rate of return on this bond, how much should she pay for it? A. $950.75 OB.$1,003.42 OC. $875.38 OD. $1,122.87 E.$796.15