Reference no: EM132799519
1. Iron Maiden became the first? heavy-metal band to sell bonds when it arranged a? $30 million deal in February 1999. The collateral on the bonds? (and source of cash flow for interest and principal? payments) consisted of future royalties from the? band's albums like? "The Number of the? Beast." Each bond in the issue had a face value of ?$1,000?, a term of 14 years and paid semiannual coupons at the rate of 5?%. The yield to maturity on the bond was 9?%.
At what price did each of the bonds? sell? (Round to the nearest? cent.)
2. With celebrity? bonds, celebrities raise money by issuing bonds to investors. The royalties from sales of the music are used to pay interest and principal on the bonds. In April of? 2009, EMI announced that it intended to securitize its back catalogue with the help of the Bank of Scotland. The bond was issued with a coupon rate of 6.8?% and will mature on this day 36 years from now. The yield on the bond issue is currently 6.3?%. At what price should this bond trade? today, assuming a face value of ?$1,000 and annual? coupons?
The price of the bond today should be ?? ?(Round to the nearest? cent.)
3. What is the price of a 3?-year, 8% coupon? rate, $1,000 face value bond that pays interest quarterly if the yield to maturity on similar bonds is 12.4%?? (Round to the nearest? cent.)
4. What is the yield to maturity of a 9.9% semiannual coupon bond with a face value of? $1,000 selling for $895.39 that matures in 11 ?years?
The annual yield to maturity of the bond? is: ?
A. 12.537%
B. 11.492%
C. 10.099%
D. 13.349%
E. 11.608%
5. Man-zeer Inc.,? (a Kramer/Costanza joint? venture) bonds are currently trading at ?$1,251.88. The bonds have a face value of $1,000?, a coupon rate of 5.5?% with coupons paid? semiannually, and they mature in 15 years.
What is the yield to maturity of the? bonds?? (Round to two decimal? places.)
6. Cyberdyne Systems is issuing a series of zero coupon bonds to raise? $500M to fund research and development at its Skynet division. Each bond will have a face value of ?$1,000 and will mature in 6 years. The yield on the bond is 8?%.
What is the fair price for one of? Cyberdyne's zero coupon? bonds? (Round to the nearest? cent.)