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Please see attachment for homework assistance. Please use EXCEL spreadsheet to answer the questions (explain how you got those numbers). Thanks 1. Suppose a bond
Please see attachment for homework assistance. Please use EXCEL spreadsheet to answer the questions (explain how you got those numbers). Thanks
1. Suppose a bond promises to pay interest of $25 every six months and repay principal of $1,000 at maturity in 30 years. If the market interest rate is 7%, calculate the bond price. 2. Assume a corporate bond selling at $1,205.16 matures in 6 years at a par value of $1,000 and pays a 9% coupon in the form of two semiannual interest payment s per year. Compute the bond's yield to maturity. 3. Suppose a 7% coupon bond with a term to maturity of 10 years is priced at $1,050. The bond can be called in 3 years at a call price of par plus one year of interest payments. Compute the yield to call of the bond. 4. Suppose a company has common stock that pays a dividend of $0.1 0 per year and has a market price of $20 per share. Also assume that the company's $1,000 p ar value, 10.5% convertible bond sells at a market quote of 100, and has a conversion ratio of 30:1. Calculate the bond's conversion value. 5. Calculate the percentage change in price for a bond featuring modified duration of 3.5 following a 30 basis point jump in interest rates. 6. Calculate the sample geometric mean, arithmetic average, standard deviation, and coefficient of variation for a stock with annual returns of 62.7%, 88.1%, -3.8 %, 18.0%, and -42.2%. 7. Below are the dividend adjusted prices for Disney and Boeing. O ver the 60 months, compute the average monthly return and standard deviation for each stock. Compute the correlation between the returns of the two stocks. What would be the average return and standard deviation of a portfolio of half Disney and half Boeing?Step by Step Solution
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