Question
Please answer ALL, Thank you ! 1. Ivanhoe Inc. has seven-year bonds outstanding that pay a 11 percent coupon rate. Investors buying these bonds today
Please answer ALL, Thank you !
1. Ivanhoe Inc. has seven-year bonds outstanding that pay a 11 percent coupon rate. Investors buying these bonds today can expect to earn a yield to maturity of 6.950 percent. What is the current value of these bonds? Assume annual coupon payments
-Current Value:
2. Barbara Jones is looking to invest in a three-year bond that makes semi-annual coupon payments at a rate of 5.375 percent. If these bonds have a market price of $978.44, what yield to maturity can she expect to earn? (Round intermediate calculations to 5 decimal places, e.g. 1.25145 and final answer to 2 decimal places, e.g. 15.25%.)
-yield to maturity:
3.Robert Williams bought 10-year bonds issued by Harvest Foods five years ago for $934.25. The bonds make semiannual coupon payments at a rate of 9.6 percent. If the current price of the bonds is $1,050.77, what is the yield that Robert would earn by selling the bonds today?
-Effective annual yield:
4.The Sheridan Department of Transportation has issued 25-year bonds that make semiannual coupon payments at a rate of 10.325 percent. The current market rate for similar securities is 11.8 percent. Assume that the face value of the bond is $1,000.
-What is the current market value of one of these bonds?
-What will be the bonds price if rates in the market (i) decrease to 9.80 percent or (ii) increase to 12.8 percent?
-Suppose the bond were to mature in 12 years. What will be the bonds price if rates in the market (i) decrease to 9.80 percent or (ii) increase to 12.8 percent?
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