USE THE FOLLOWING INFORMATION ON PROBLEMS 1-5.

Vulpis Inc. has just made an issue of 20-year maturity $1,000 par value bonds with a 9% coupon rate. The bond is currently selling in the market for $1,200.

If the required rate of return on comparably risky bonds is 6%, what is the intrinsic value of Vulpis Inc. bonds?

		$1,401.04
		$1,346.72
		$1,244.10
		$1,198.51

Vulpis Inc. has just made an issue of 20-year maturity $1,000 par value bonds with a 9% coupon rate. The bond is currently selling in the market for $1,200.

What is the bond's YTM?

		4.55%
		5.92%
		7.11%
		9.20%

Vulpis Inc. has just made an issue of 20-year maturity $1,000 par value bonds with a 9% coupon rate. The bond is currently selling in the market for $1,200.

Suppose that the overall required rate of return on all bonds in the market goes up by 1% immediately after Vulpis Inc. issues their bonds. If the market now requires 7% on bonds, what is the intrinsic value of Vulpis Inc. bonds?

		$1,031.17
		$1,157.49
		$1,213.55
		$1,343.08