Assume the par value of each bond to be $1000. These debentures are quoted in eighths of a point. Create a spreadsheet that will model and answer the following three bond investments problems.

CHAPTER 10 FIXED-INCOME SECURITIES 403 in eighths of a point. Create a spreadsheet that will model and answer the following three bond investment problems. Bonds Current Yield Volume Close GPC 5.3 13 GPC 6.65s 20 ? 25 105%8 GPC 7.4 22 103 ? 37 104%8 Questions a. Calculate the current yields for these three GPC corporate debentures. b. Calculate the holding period returns under the following three scenarios: 1. Purchased the 5.3 bonds for 990 on January 13, 2009. 2. Purchased the 6.65s for 988 on January 13, 2009. 3. Purchased the 7.4 bonds for 985 on January 13, 2007. c. As of January 13, 2010, GPC common stock had a close price of $26.20. The price of GPC stock in January 2007 was $25.25. The stock paid a 2007 dividend of $0.46, a 2008 dividend of $0.46, and a 2009 dividend of $0.46. 1. Calculate the current (January 13, 2010) dividend yield for this security. 2. Assuming you purchased the stock in January 2007, what is the holding period return as of January 2009? ? 45 CHAPTER 10 FIXED-INCOME SECURITIES 403 in eighths of a point. Create a spreadsheet that will model and answer the following three bond investment problems. Bonds Current Yield Volume Close GPC 5.3 13 GPC 6.65s 20 ? 25 105%8 GPC 7.4 22 103 ? 37 104%8 Questions a. Calculate the current yields for these three GPC corporate debentures. b. Calculate the holding period returns under the following three scenarios: 1. Purchased the 5.3 bonds for 990 on January 13, 2009. 2. Purchased the 6.65s for 988 on January 13, 2009. 3. Purchased the 7.4 bonds for 985 on January 13, 2007. c. As of January 13, 2010, GPC common stock had a close price of $26.20. The price of GPC stock in January 2007 was $25.25. The stock paid a 2007 dividend of $0.46, a 2008 dividend of $0.46, and a 2009 dividend of $0.46. 1. Calculate the current (January 13, 2010) dividend yield for this security. 2. Assuming you purchased the stock in January 2007, what is the holding period return as of January 2009? ? 45