HELP

Q1

Last year Carson Industries issued a 10-year, 14% semiannual coupon bond at its par value of $1,000. Currently, the bond can be called in 6 years at a price of $1,070 and it sells for $1,350.

1. What are the bond's nominal yield to maturity and its nominal yield to call? Do not round intermediate calculations. Round your answers to two decimal places.

YTM: %

Q2

It is now January 1, 2021, and you are considering the purchase of an outstanding bond that was issued on January 1, 2019. It has an 8.5% annual coupon and had a 30-year original maturity. (It matures on December 31, 2048.) There is 5 years of call protection (until December 31, 2023), after which time it can be called at 108that is, at 108% of par, or $1,080. Interest rates have declined since it was issued, and it is now selling at 116.57% of par, or $1,165.70.

1. What is the yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places.

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What is the yield to call? Do not round intermediate calculations. Round your answer to two decimal places.

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Q3

Kempton Enterprises has bonds outstanding with a $1,000 face value and 10 years left until maturity. They have a 12% annual coupon payment, and their current price is $1,175. The bonds may be called in 5 years at 109% of face value (Call price = $1,090).

1. What is the yield to call if they are called in 5 years? Do not round intermediate calculations. Round your answer to two decimal places.

%

Last year Carson Industries issued a 10-year, 14% semiannual coupon bond at its par value of $1,000. Currently, the bond can be called in 6 years at a price of $1,070 and it sells for $1,350. a. What are the bond's nominal yield to maturity and its nominal yield to call? Do not round intermediate calculations. Round your answers to two decimal places. YTM: % YTC: % Would an investor be more likely to earn the YTM or the YTC? \begin{tabular}{|c|c|c|c|} \hline 4 & A & B & C \\ \hline \multicolumn{4}{|l|}{69} \\ \hline 70 & NPER 1 & 10 & 20 \\ \hline 71 & NPER 2 & 6 & 12 \\ \hline 72 & Coupon RATE & 0.14 & \\ \hline 73 & PMT & 70 & \\ \hline 74 & FV 1 & 1000 & \\ \hline 75 & PV & 1350 & \\ \hline 76 & FV 2 & 1070 & \\ \hline 77 & YTM & =RATE(C70,B73, & B75,B74)*2 \\ \hline 78 & YTC & 0.075759398 & 7.575939805 \\ \hline 79 & & & \\ \hline 80 & Annual coupon & 140 & \\ \hline 81 & Current Yield & 0.103703704 & 10.37037037 \\ \hline 82 & Expected yield & -0.027944306 & -2.79443057 \\ \hline 83 & & & \\ \hline \end{tabular} It is now January 1,2021 , and you are considering the purchase of an outstanding bond that was issued on January 1, 2019. It has an 8.5% annual coupon and had a 30 -year original maturity. (It matures on December 31,2048 .) There is 5 years of call protection (until December 31, 2023), after which time it can be called at 108 -that is, at 108% of par, or $1,080. Interest rates have declined since it was issued, and it is now selling at 116.57% of par, or $1,165.70. a. What is the yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. % What is the yield to call? Do not round intermediate calculations. Round your answer to two decimal places. % b. If you bought this bond, which return would you actually earn? \begin{tabular}{l|l|r|} \hline 84 & & \\ 85 & NPER 1 & 28 \\ 86 & NPER 2 & 3 \\ 87 & CR & 0.085 \\ 88 & PMT & 85 \\ 89 & FV & 1000 \\ 90 & CP & 1080 \\ 91 & PV & 1165.7 \\ 92 & YTM & =RATE(B85,B88,-B91,B89) \\ \hline 93 & YTC & =RATE(B86,B88,-B91,B90) \\ \hline 94 & & \end{tabular} Kempton Enterprises has bonds outstanding with a $1,000 face value and 10 years left until maturity. They have a 12% annual coupon payment, and their current price is $1,175. The bonds may be called in 5 years at 109% of face value (Call price = $1,090). a. What is the yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. % b. What is the yield to call if they are called in 5 years? Do not round intermediate calculations. Round your answer to two decimal places. \begin{tabular}{|c|c|c|c|} \hline B106 & \multirow{2}{*}{Afx} & \multicolumn{2}{|l|}{= RATE (B99,B101,B103,B104)} \\ \hline & & B & C \\ \hline 1 & & & \\ \hline 98 NPER 1 & & 10 & 20 \\ \hline 99 NPER 2 & & 5 & 10 \\ \hline 100CR & & 0.12 & \\ \hline 101 PMT & & 120 & \\ \hline 102FV & & 1000 & \\ \hline 103CP & & 1090 & \\ \hline 104 PV & & 1175 & \\ \hline 105 YTM & & 9% & 9.243814518 \\ \hline 106 YTC & & 12% & 12.23105941 \\ \hline \end{tabular}