Suppose a U.S. government bond promises to pay $3,000 three years from now. If the going interest rate on a 3-year government bond is 7%, how much is the bond worth today?
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- Suppose a U.S. government bond promises to pay $3,000 three years from now. If the going interest rate on a 3-year government bond is 7%, how much is the bond worth today?
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- Suppose a U.S. government bond will pay $1,000 three years from now. If the going interest rate on 3‐year government bonds is 4%, how much is the bond worth today?Suppose a State of New York bond will pay $1,000 ten years from now. If the going interest rate on these 10-year bonds is 5.0%, how much is the bond worth today?Suppose a U.S treasury bond will pay $4,150 five years from now. If the going interest rate on 5-year treasury bond is 4.25%, how much is the bond worth today?
- Suppose a state of California bond will pay $1,000 eight years from now. If the going interest rate on these 8-year bond is 6.4%, how much is the bond worth today?Suppose a State of Califomla bond will pay 1,000 eight years from now. If the going interest rate on these 8 year bonds is 6.0% how much is the bond worth today?Suppose a pure discount State of New York bond will pay $1,000 ten years from now. If the going interest rate on these 10-year bonds is 3.5%, how much is the bond worth today?
- A U.S. government bond matures in 10 years. Its quoted price is now 96.4, which means the buyer will pay $96.40 per $100 of the bond’s face value. The bond pays 5% interest on its face value each year. If $10,000 (the face value) worth of these bonds are purchased now, what is the yield to the investor who holds the bonds for 10 years?A US government bond in the amount of $1,000 will mature in six years, has no coupon payments, and carries an interest rate of 8%. What is the value of this bond today?Suppose a U.S. government bond promises to pay $2,249.73 three years from now.If the going interest rate on 3-year government bonds is 4%, how much is the bondworth today? How much is it worth today if the bond matured in 5 years rather than3? How much is it worth today if the interest rate on the 5-year bond was 6% ratherthan 4%? ($2,000, $1,849.11, $1,681.13)
- Suppose that today is October 30th, 2021. A US Treasury bond was issued four months ago, i.e. on June 30th, 2021, with the following characteristics. It will pay back a par value of 1,000 USD two years after the issuance date, and it also pays coupons calculated with an annual coupon rate of 6.3%. The annual interest rate is constant at 4%. Assume that every month is made of 30 days. a. What is the value of the interest rate that you decide to use to price such a bond? If it is already available in the exercise, just report it. If it is not available, compute it. b. Compute the current price of this bond, which you will read on the Wall Street Journal, as of October 30th, 2021. Please clearly list as b1, b2, b3 etc, all the steps in your solution.Suppose an Exxon Corporation bond will pay $1,000 twenty years from now. If the going interest rate on safe 20-year bonds is 6.90%, how much is the bond worth today?A 10-year government bond has face value of OR 200 and a coupon rate of 6% paid semiannually. Assume that the interest rate is equal to 8% per year. What is the bond’s price? What is the reason for the difference in price on an annual and semiannually basis? Discuss the role of financial managers.