Question
WILL UPVOTE! Part A) The Wild Rose Company has $1,000 par value (maturity value) bonds outstanding at 9 percent interest. The bonds will mature in
WILL UPVOTE! Part A) The Wild Rose Company has $1,000 par value (maturity value) bonds outstanding at 9 percent interest. The bonds will mature in 15 years with annual payments.
Compute the current price of the bonds if the present yield to maturity is: (Use a Financial calculator to arrive at the answers. Do not round intermediate calculations. Round the final answers to 2 decimal places.)
Price of the bond | ||
a. 7 percent | $ | |
b. 8 percent | $ | |
c. 12 percent | $ | |
Part B) Bonds issued by the Coleman Manufacturing Company have a par value of $1,000, which is also the amount of principal to be paid at maturity. The bonds are currently selling for $690. They have 10 years to maturity. Annual interest is 13 percent ($130), paid semiannually.
Compute the yield to maturity. (Do not round intermediate calculation. Use a Financial calculator to arrive at the answers. Round the final answer to 2 decimal places.)
Yield to maturity %
Part C)
If you invest $9,600 per period for the following number of periods, how much would you have received at the end? (Use a Financial calculator to arrive at the answers. Round the final answers to the nearest whole dollar.)
a. 14 years at 6 percent.
Future value $
b. 20 years at 10 percent.
Future value $
c. 18 periods at 14 percent.
Future value $
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