A 9.14% annual coupon, 23-year bond has a yield to maturity of 4.64%. Assuming the par value is $1,000 and the YTM is expected not to change over the next year, what is bond price expected to be in one year?
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- Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for 1,135.90, producing a nominal yield to maturity of 8%. However, the bond can be called after 5 years for a price of 1,050. (1) What is the bonds nominal yield to call (YTC)? (2) If you bought this bond, do you think you would be more likely to earn the YTM or the YTC? Why?Assuming annual coupon payment, a 3-year 8% coupon bond has a yield to maturity 9 percent. What is the duration? If market rate decrease by 0.75%, what’s the percentage change in bond price using the duration estimation approach?Consider a bond with a 10% coupon and yield to maturity = 8%. If the bond’s yield to maturity remains constant, then in one year, will the bond price be higher, lower, or unchanged? Why?
- Consider the following $1,000 par value zero-coupon bonds. Bond Years until maturity Yield to maturity A 1 5.0% B 2 6.0% C 3 6.5% D 4 7.0% According to the expectation hypothesis, what is the market’s expectation of the yield curve one year from now? Specifically, what are the expected values of next year’s yield on bonds with maturities of (i) 1 year; (ii) 2 years; (iii) 3 years?You are looking at a 18-year zero-coupon bond that has a yield to maturity of 5.0% . What is the value of the bond? Assume semi-annual compounding. leA 4.4% annual coupon, 24-year bond has a yield to maturity of 4.61%. Assuming the par value is $1,000 and the YTM is expected not to change over the next year, what should the price of the bond be today?
- A ten-year maturity bond with a coupon rate of 6% is now selling at $1,085. What are the current yield and capital gain yield for this bond assuming the yield to maturity of this bond remain unchanged? (Please Show Work)What is the market price of a redeemable (at par) bond, with a maturity date in 4 years’ time, and a coupon rate of 10%, if current cost of debt, Kd (return required or yield) is 8%?Consider a bond that has a current value of $1,081.11, a face value of $1,000.00, a coupon rate of 10% and five years remaining to maturity.a. What is the bond’s yield-to-maturity today?b. If the bond’s yield does not change, what is its value one year from today? Please solve both parts
- Consider a zero-coupon bond with a maturity of 13 years and a face value of $1 Million. If the current market price of the bond is $751,226, and interest accrues semi-annually, what is the nominal yield-to-maturity of the bond?What is the yield-to-maturity of a bond with a coupon rate of 9.0%, par value of $2000, 7 years until maturity, and a value of $987.33 if coupons are paid annually with the next one due in one year?Consider a bond that has a current value of $1,081.11, a face value of $1,000.00, a coupon rate of 10% and five years remaining to maturity.a. What is the bond’s yield-to-maturity today?b. If the bond’s yield does not change, what is its value one year from today?