Topic: Bond valuation

Attempt all the following Questions.

Q.1 A fours years bond along with the 8% coupon rate and Rs.1000 face value has the yield to maturity of 9%. Assuming annual coupon payment, calculate the price of the bond.

Q.2 A person buy a 9% annual coupon bond at Rs. 1,040, hold it for one year and sell at Rs. 1,065. What is the holding period return he would be achieve?

Q.3 A five-year bond has an 7% coupon rate and a YTM of 9%. What annual interest payment you will be get if you hold it for the three years and also at what price you will be sell the bond after a three years?

Q.4 A 8.3% annual coupon bond with eleven-year maturity has a YTM of 9%. If, assuming that the yield curve is flat and didnt shift, calculate the HPR you would achieve from buying the bond, holding it for one year only.

Q.2 Find out the current year yield for the 10 years along with the 8% coupon bond which sells for $890 dollar, and has $1000 face value.

Q.3 Suppose you are offering at $245 zero coupon bond along with the $1000 face value which will mature in the twenty years. If bond yield to maturity (YTM) is 8%, then after a two years what will be a price of bond?

Q.4 The face value of the bond is $1000 that will be redeemed after a four years @ $1200. The per annum coupon rate is 8%. Regulate the yield to maturity (YTM), if the bond present market price is $1050.

Q.5 A four-year bond along with 12% coupon rate, $1000 book value has the YTM of 10%. Assuming the coupon payment annually, calculate the bond price.