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#6. Workman Software has 8.2 percent coupon bonds on the market with 6 years to maturity. The bonds make semiannual payments and currently sell for

#6. Workman Software has 8.2 percent coupon bonds on the market with 6 years to maturity. The bonds make semiannual payments and currently sell for 84.3 percent of par.

  1. What is the current yield on the bonds?
  1. 0.20%
  2. 10.71%
  3. 9.73%
  4. 10.21%

  1. The YTM?
  1. 11.93%
  2. 12.11%
  3. 8.70%
  4. 5.96%

  1. The effective annual yield?
  1. 0.10%
  2. 11.90%
  3. 12.90%
  4. 12.29%

#7. Weismann Co. issued 6-year bonds a year ago at a coupon rate of 10 percent. The bonds make semiannual payments and have a par value of $1,000. If the YTM on these bonds is 7 percent, what is the current bond price?

  1. $1,295.08
  2. $784.24
  3. $1,124.75
  4. $1,084.93
  5. $1,134.75

#13. Gabriele Enterprises has bonds on the market making annual payments, with 18 years to maturity, a par value of $1,000, and selling for $930. At this price, the bonds yield 10 percent. What must the coupon rate be on the bonds?

  1. 9.15%
  2. 18.29%
  3. 9.83%
  4. 10.00%
  5. 9.25%

#17. Both Bond Sam and Bond Dave have 9 percent coupons, make semiannual payments, and are priced at par value. Bond Sam has 4 years to maturity, whereas Bond Dave has 16 years to maturity.

If interest rates suddenly rise by 2 percent, what is the percentage change in the price of Bond Sam?

  1. -6.31%
  2. -6.76%
  3. -6.33%
  4. 6.43%

If interest rates suddenly rise by 2 percent, what is the percentage change in the price of Bond Dave?

  1. 16.01%
  2. -17.51%
  3. -14.90%
  4. -14.88%

If rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of Bond Sam be then?

  1. 6.85%
  2. -6.28%
  3. 6.43%
  4. 6.87%

If rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of Bond Dave be then?

  1. 19.05%
  2. -14.85%
  3. 16.01%
  4. 19.07%

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