Reference no: EM131052238
(a) What is the price of an annual coupon bond whose par value is 1,000, that pays interest of 7%, has a maturity of eight years, and whose yield to maturity is 6.5%?
(b) What is the yield to maturity of a bond whose price is 1,200, whose par value is 1,000, that pays 6% interest semi-annually, and that has 9 years to maturity?
(c) If a zero-coupon bond will mature in 5 years, its par value is 1,000, and its price is 825, then what is its yield to maturity?
(d) A 1,000 par-value bond with a 15-year maturity was issued 4 years ago. It pays 6.5% interest, and the yield-to-maturity on similarly risky bonds is currently 2.75%. Investors expect the firm to call the bonds in 4 years, despite the requirement that the firm will need to pay 10% of the par value as a penalty for doing so. Find the price of the bond.
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Compute the realized rate of return for investor
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Assuming the pure expectations theory
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What is the yield to maturity of a bond
: What is the price of an annual coupon bond whose par value is 1,000, that pays interest of 7%, has a maturity of eight years, and whose yield to maturity is 6.5%? What is the yield to maturity of a bond whose price is 1,200, whose par value is 1,000,..
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Made margin purchase
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Defined as the volatility of an investment
: Which of the following terms is defined as the volatility of an investment, including firm-specific risk, as well as market risk?
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