What is its approximate yield to maturity

Assignment Help Financial Management
Reference no: EM131999411

Use the following list of Treasury bond prices as of March 15, 2013 to derive (bootstrap) discount factors for 6 months, 1 year, 18 months, and 2 years:

Maturity Coupon Price

9/15/2013 4.750% 102-077

3/15/2014 4.125% 103-21

9/15/2014 5.000% 106-102

3/15/2015 5.000% 107-276

2. A 10-year bond pays 12 interest on a $1000 face value annually. If it currently sells for $1,190, what is its approximate yield to maturity?

11.64 10.14 10.64 12.14

Reference no: EM131999411

Questions Cloud

What is the npv of this investment opportunity : What is the NPV of this investment opportunity? What is the NPV of the project now?
Estimated by the capm for the common stock : What is the required rate of return estimated by the CAPM for the common stock?
Required rates of returns for the three securities : What are the corresponding required rates of returns for the three securities?
Why is that rate calculated above an appropriate rate : what is the required rate of return on Intel stock? Why is that rate calculated above an appropriate rate?
What is its approximate yield to maturity : A 10-year bond pays 12 interest on a $1000 face value annually. If it currently sells for $1,190, what is its approximate yield to maturity?
Distinguish between the value of security and its price : Distinguish between the value of a security and its price. Under what conditions would value equal price?
Price of the bond given the market clearing yield : What is the price of the bond given the discount factors above? What is the price of the bond given the market clearing yield (YTM)?
Explain how ETFs are exposed to exchange rate risk : Describe international ETFs, and explain how ETFs are exposed to exchange rate risk.
What will be the required return on your new portfolio : You have been managing a $5 million portfolio that has beta of 1.25 and required rate of return of 12%. What will be the required return on your new portfolio?

Reviews

Write a Review

Financial Management Questions & Answers

  What is the percentage holding period return

On January 1, 2006 you purchased $10,000 face value amount of the 6.125% coupon Citigroup bond maturing on August of 2025. The purchase price was 103.95%. On December 31, 2006 you sell your holding of this bond for a price of 103.85%. What is the per..

  Trading in commodity futures and commodity futures options

How does trading in commodity futures and commodity futures options really go? What is the approach to risk management as far as the same is concerned?

  Define the interest tax shield

Incite Co. has a 35 percent tax rate. Its total interest payment for the year just ended was $38 million. What is the interest tax shield?

  Calculate the coefficient of variation of the risk-return

Calculate the coefficient of variation of the risk-return relationship during each decade since 1950.

  What is the contribution margin per unit

Net Present Value: The Lees are considering adding a new piece of equipment that will speed up the process of building the bobble heads.

  Purpose of preparing periodic report at regular intervals

What is the purpose of preparing a periodic report at regular intervals? How should management use the information contained in periodic budget reports?

  Calculation is based on an annual effective interest rate

Sydney wins a prize. She has a choice of receiving a payment of $160,000 immediately or of receiving a deferred perpetuity with $10,000 annual payments, the first payment occurring in exactly four years. Which has a greater present value if the calcu..

  Assumed to come at the end of each payment period

Annuity payments are assumed to come at the end of each payment period (termed an ordinary annuity).

  Applies to individual taxpayers are correct

All of the following statements concerning the AMT as it applies to individual taxpayers are correct, EXCEPT:

  Calculate the annual rates of return

Calculate the annual rates of return for each of the past 10 years for each stock.

  Paying in total interest over the life of the loan

If you repay the loan in 16 years how much are you paying in total interest over the life of the loan?

  Firm is considering purchasing computer system

A firm is considering purchasing a computer system. determine the INFLATION-FREE IRR' of the computer system.

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