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PLEASE USE EXCEL FOR THE FORMULAS AND SHOW STEP BY STEP! Question 1. GTF Corporation has 5 percent coupon bonds on the market with a
PLEASE USE EXCEL FOR THE FORMULAS AND SHOW STEP BY STEP!
Question 1. GTF Corporation has 5 percent coupon bonds on the market with a par of $1,000 and 10 years left to maturity. The bonds make annual interest payments. If the market interest rate on these bonds is 6 percent, what is the current bond price? Question 2. MTV Corporation has 10 percent coupon bonds on the market with a par of $1,000 and 8 years left to maturity. The bonds make semi-annual interest payments. If the market interest rate on these bonds is 8 percent, what is the current bond price? Question 3. Jones Corporation has zero coupon bonds on the market with a par of $1,000 and 10 years left to maturity. If the market interest rate on these bonds is 6 percent, what is the current bond price? (Use the semi-annual interest payment model.) Question 4. Wilson Corporation has 6 percent coupon bonds on the market with a par of $1,000 and 5 years left to maturity. The bonds make annual interest payments. If these bonds currently sell for $900, what is its yield to maturity (YTM)? Question 5. Linville Corporation issued 12-year, par $1,000 bonds ten years ago at a coupon rate of 7 percent. The bonds make semi-annual payments. If these bonds currently sell for 95 percent of par value, what is its yield to maturity (YTM)? Question 6. Pecos Company has just issued a 10-year, 8 percent coupon rate, $1,000 par bond that pays interest semiannually. Four years later, if the going rate of interest on the bond falls to 6 percent, what is the value of the bond? Question 7. Karen just bought a 10 -year, 6% coupon bond with $1,000 par for $805. If she sells) this bond two years later for $920, what is her realized yield in year 3 (with semi-annual interests)Step by Step Solution
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