Reference no: EM132787189

Marco Bond is a billionaire who wants to invest some of its petty cash in corporate bonds. You, as the hired financial planner of Marco, suggested the following bonds who all have a yield to maturity of 10% and matures in 15 years:

PCOR - 8% annual coupon rate; P1,000 face value
PGOLD - 10% annual coupon rate; P1,000 face value
PSE - 12% annual coupon rate; P1,000 face value

Problem 1.) If PCOR bond is sold after a year the total expected return of the bond is 14%, what is approximate price in which PCOR bond is sold.

a. 886.54

b. 890.55

c. 1,110.00

d. 900.00

Problem 2.) If PGOLD bond is sold after a year the total expected return of the bond is 14%, what is approximate price in which PGOLD bond is sold.

a. 1,440

b. 1,069

c. 1,040

d. 1,563

Problem 3.) If PSE bond is sold after a year the total expected return of the bond is 14%, what is approximate price in which PSE bond is sold

a. 1,400.00

b. 1,235.56

c. 1,193.37

d. 1,333.33