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BCD s is about to issue a series of $ 1 , 0 0 0 par value bonds at a price of $ 7 7

BCDs is about to issue a series of $1,000 par value bonds at a price of $777.50. The coupon
rate is 10% per annum, paid annually. The bonds will mature in ten years. Calculate the current
yield and yield to maturity?
10. CPDs bonds have 18 years remaining to maturity. Interest of $85 is paid annually, and the
bonds have a $1,000 par value. The bonds sell at a price of $885. What is the current yield
and yield to maturity?
11. Prime Investment issued $1,000 par value bonds that have a 9% coupon rate, payable semiannually. The bonds were issued April 1,2019, with a 30-year maturity.
a. What is the maturity date of these bonds?
b. List the expected payments and the dates of these payments, if the bond is purchased on
October 1,2035.
Page 3 of 3
12. Your firms financial advisor has recommended the use of long-term bonds for raising new
financing. You have accepted this advice, and your firm has issued 15-year bonds, with a
coupon rate of 6%, payable semi-annually. The date of issue is January 1,2021, and their par
value is $1,000.

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