LAB 13

1) A bond with a $1,600 face value and 12 years remaining until maturity pays a coupon rate of 8.25% compounded semi-annually. Calculate the yield to maturity if the bond is priced at $1,280.

2) A $3,000 bond with a 2.5% coupon compounded semi-annually is currently priced to yield 8% with 19 years remaining to maturity. What is the yield to maturity five years from now if the bond price rises $200 at that time?

3) A $90,000, 9.00% bond redeemable at par, with annual coupon payments, is purchased 6 years before maturity to yield 4.00% compounded annually.

a.What was the purchase price of the bond?

Round to the nearest cent

b.What was the amount of discount or premium on the bond?

4) A $8,000 bond with a coupon rate of 8.50% is purchased 8.5 years before maturity when the yield rate was 8.00% compounded semi-annually. The bond coupons are paid every six months. Calculate the purchase price of the bond.

5) A $5,000,000 issue of a 30-year bond, redeemable at par, offers 9.00% coupons payable semi-annually. The bond yields 4.50% compounded monthly.

a.What was the purchase price of the bond, if it was purchased 20 years before maturity?

b.What was the amount of discount or premium on the bond?