Question
DIS has issued a bond (A) with a face value of $1,000 USD, with a coupon payment of 3.5% and maturing in 8 years. In
DIS has issued a bond (A) with a face value of $1,000 USD, with a coupon payment of 3.5% and maturing in 8 years. In addition, the company issued a bond (B) 2 years ago, when the interest rate was lower, this bond has a face value of $1,000 and bears a coupon of 2.25%, the maturity was 10 years, therefore, today It has 8 years left to maturity. Since today's benchmark rate is 3.25%. Answer the following:
1. If the holder of bond B has the option to repurchase in 3 years, what would the repurchase yield be if it were made at $985 dollars ________
2. If the issuer has the call option in year 6 of bond A, what yield will the holder have if the call price is $1035 dollars. _________
3. If the issuer of these bonds makes an amortization of 50% in the middle of the term remaining to maturity, what would be the yield to maturity on each bond? _________
4. If Bondholder A has the right to convert for 8 Disney shares at maturity, what would the yield be if the share returned to its maximum price of $192? _________
Note: Please show your answer in Excel
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