Question
*Please answer all questions correctly or I will thumbs down. Answer all correctly, I will thumbs up. 4) ABC, Inc. currently has an issue of
*Please answer all questions correctly or I will thumbs down. Answer all correctly, I will thumbs up.
4) ABC, Inc. currently has an issue of bonds outstanding that will mature in 31 years. The bonds have a face value of $1,000 and a stated annual coupon rate of 20.0% with annual coupon payments. The bond is currently selling for $1000. What is your expected quoted annual rate of return if you buy the bonds and hold them until maturity?
5) XYZ, Inc. has a bond issue outstanding with a $1,000 par value and a maturity of 40 years. The bonds have an annual coupon rate of 15.0% with quarterly coupon payments. The current market price for the bonds is $1,035. The bonds may be called in 4 years for 115.0% of par. What is the quoted annual yield-to-maturity for the bonds? What is yield to call?
6) You are considering buying bonds in HGZT, Inc. The bonds have a par value of $1,000 and mature in 13 years. The annual coupon rate is 11% and the coupon payments are annual. The bonds are currently selling for$1,442.63 based on a yield-to-maturity of 6.0%. What is the bond's current yield?
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