Coupon bond that pays interest annually

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Reference no: EM131859463

1) If a 7% coupon bond is trading for $975.00, it has a current yield of

A) 7.00%. B) 6.53%. C) 7.24%. D) 8.53%. E) 7.18%.

2) A coupon bond that pays interest annually is selling at par value of $1,000, matures in five years, and has a coupon rate of 9%. The yield to maturity on this bond is

A) 8.0%.

B) 8.3%.

C) 9.0%.

D) 10.0%.

E) None of the options

3) A coupon bond that pays interest semi-annually has a par value of $1,000, matures in five years, and has a yield to maturity of 10%. The intrinsic value of the bond today will be ________ if the coupon rate is 8%.

A) $922.78

B) $924.16

C) $1,075.80

D) $1,077.20

E) None of the options

4) A zero-coupon bond has a yield to maturity of 9% and a par value of $1,000. If the bond matures in eight years, the bond should sell for a price of ________ today.

A) 422.41

B) $501.87

C) $513.16

D) $483.49

E) None of the options

Reference no: EM131859463

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