Question
You have paid $980.30 for an 8% coupon bond with a face value of $1,000 that mature in five years. You plan on holding the
You have paid $980.30 for an 8% coupon bond with a face value of $1,000 that mature in five years. You plan on holding the bond for one year. If you want to earn a 9% rate of return on this investment, what price must you sell the bond for? Is this realistic?
Consider a bond with a 7% annual coupon and a face value of $1,000. Complete the following table:
Years to Maturity | Discount Rate | Current Price |
3 | 5 |
|
3 | 7 |
|
6 | 7 |
|
9 | 7 |
|
9 | 9 |
|
What relationship do you observe between yield to maturity and the current market value?
Calculate the duration of a $1,000 6% coupon bond with three years to maturity. Assume that all market interest rates are 7%.
I have all the answers, I just really need to see the calculations please!
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