A Chapter 10 In Class Questions - Word Sign in File Home Insert Design Layout References Mailings Review View Q Tell me what you want to do A Share X Cut Times New Ro I 21 T AaBbccDe AaBbccDe AaBBC AaBbcci AaB AaBbcat AaBbccD : AaBbccD = = = As - - 1 Normal No Spa. Heading 1 Heading 2 Title Subtitle Subtle Eman Emphasis A Select Paste o Fomat Painter Bu at X, X A - - A Clipboard Font Paragraph Editing 1. A coupon bond which pays interest of $50 annually, has a par value of $1000, matures in 1 years, and is selling today at a price of $902. The actual yield to maturity on this bond is 2. A teary bond due in one year has a yield of 1.32% while a treasury bond due in 5 years has a yield of 3.21%. A bond due in one year issued by High Country Marketing Corporation has a yield of 5.41% while a bond due in 5 years issued by High Country Marketing Corporation has a yield of 6.01%. The default risk premiums on the scene-year and 5-year bonds issued by High Country Marketing Corp. are 1 respsctively . and 3. A zero-coupon bond has a ield to maturity of 66 and a par value of $1000. If the bond matures in 10 years, it should sell for a price of today . 4. The yield to maturity of a 4-year zero coupon bced, with a par value of $$1,000 and a market price of $331, is 5. One, two and three-year maturity, default-free. zero-coupon bonds have yield-to-matarity of 3%, 4% and 5% respectively. What is the implied one-year forward rates, one year from today? 6. A bond has a T3% coupon rate. The coupon is paid seeii-annually and the last coupoe was paid 43 days ago. If the bond had a par value of $1,000, what is the accrued interest (assume a 364. day year)? 7. Suppose you have a 19%, 25 year bond traded a $900. It it is callable in 10 years at $110 what is the bond's yield to call: Interest is paid semiannually USE THE FOLLOWING INFORMATION FOR THE NEXT3 QUESTIONS: Assume that you purchase a near $1,000 par value bond, with a 8% coupon, and a yield of 75%. Immediately after you purchase the bond , yields change to 7% and remain at that level to maturity. Assume that you hold the bond for 5 years and then sell it. Interest is paid annually. S. What is the price of the band today? 9. What is the price of the band after 5 years? 10. Now, calculate the realized horizon yield for this bond if you hold it for 3 years and then sell 11. Assume you purchased a bond with a maturity of acatiy 15 years, a coupon rate of 79% (paid once a year), a face value of $1,000, and a yield to maturity of T9%. Right after you purchased the bood, rates change from 79% to 8%. If you beld the bond to maturity, and reinvested the coupons at 39%, you actual rate of return would be 12. What is the current yield on a 6% bored with a carent market price of $850 Page 1 of 1 466 words Type here to search DOM Oe C9 Owi to 69% 1231 PM A ) * On 10/26/2017 Ed
