Find the resulting percentage change in the bond price

Assignment Help Financial Management
Reference no: EM131938740

You have a four-year bond with a coupon rate CR = 6% and a face value of $1,000. The bond makes annual coupon payments and its yield to maturity is 2% p.a. If the bond's yield to maturity increases by 1% (i.e., by 100 basis points), find the resulting percentage change in the bond's price. For example, if the bond's price changes from $1,000 to $900, then the percentage change in price would be 100x(900 - 1,000)/1,000 = -10.00%. Give the answer as a percent with two decimals, e.g., -7.12%.

Reference no: EM131938740

Questions Cloud

What is the duration of this stock : You have a stock that is expected to pay a $1.3 dividend one year from now. what is the duration of this stock?
The bond makes annual coupon payments : The bond makes annual coupon payments and its yield to maturity is 19% p.a.
State the definition of the 40th decile : (Deciles.) The 10th, 20th, 30th, 40th, 50th, 60th, 70th, 80th, 90th, and 100th percentiles for X are called its deciles.
Particular variety of moss using the data : Approximate the 50th percentile for X, the percentage ash content for a particular variety of moss using the data.
Find the resulting percentage change in the bond price : You have a four-year bond with a coupon rate CR = 6% and a face value of $1,000. find the resulting percentage change in the bond price
Approximate the mean-variance and standard deviation : Use the data of Exercise 11 to approximate the mean, variance, and standard deviation of the random variable X, the percentage ash content of a particular
The root causes of the greek predicaments : The root causes of the Greek predicaments. the costs and benefits of staying in the euro-zone for Greece.
Who are the stakeholders besides the obvious : Find an article from a trusted media source published within the last six months illustrating an ethical issue regarding marketing products, services or ideas.
Produce a plot of fertility rate versus age at first marriag : 161.221: Applied Linear Models Assignment. Produce a plot of fertility rate versus age at first marriage. Comment on any features you notice

Reviews

Write a Review

Financial Management Questions & Answers

  The return on bond which is sold before maturity

The return on a bond which is sold before maturity

  Any assistance in monitoring the project

Would a project management office establishment be of any assistance in monitoring the project?

  What is the future value of his investment cash flows

Robert White will receive from his investment cash flows of $4,450, $4,775, and $5,125. If he can earn 7 percent on any investment that he makes, what is the future value of his investment cash flows at the end of three years?

  How much are your monthly payments for the? loan

How much are your monthly payments for the? loan? What is the balance of the mortgage loan after 4 ?year(s) of? payments

  Find the highest level of fixed costs

Assuming that the price per carton is $17.30, find the highest level of fixed costs you could afford each year and still break even.

  What does your technical analysis indicate

What does your technical analysis indicate about the XLB?

  About whom to select for questioning in the border regions

The U. S. Border Patrol has been accused of racial profiling in its decisions about whom to select for questioning in the border regions. People who "look Mexican" have been stopped and question under suspicion of being illegal immigrants.

  Break-even analysis

The Hartnett Corporation manufactures baseball bats with Pudge Rodriguez’s autograph stamped on them. Each bat sells for $35 and has a variable cost of $22. There are $97,500 in fixed costs involved in the production process. Compute the break-even p..

  Effective annual interest rate

Ryan pays back a loan of X in one lump sum at the end of 20 years. The effective annual interest rate is 7%. Find X.

  Manufactures two products called alpha and beta

Cane Company manufactures two products called Alpha and Beta that sell for $190 and $155, respectively. Each product uses only one type of raw material that costs $8 per pound. How many pounds of raw material are needed to make one unit of Alpha and ..

  About a cost plus award fee contract

Which of the following characteristics is FALSE about a Cost Plus Award Fee contract?

  Standard deviation and expected return

What are the standard deviation and expected return of the minimum variance portfolio?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd