Given below is information about three RM $5000 par value bonds, each of which pays coupon semiannually. The required rate of return on each bond is 12%. Calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value…….
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- Given below is information about three RM $5000 par
value bonds , each of which pays coupon semiannually. The requiredrate of return on each bond is 12%. Calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value…….
|
Bond |
Coupon Rate (%) |
Maturity (years) |
|
1 |
10 |
5 |
|
2 |
12 |
10 |
|
3 |
14 |
15 |
- Using the above table, if the company decided to pay coupon annually (12%), calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value
- Explain the of Bonds available in the market for the Companies to raise fund……Is there any difference in the value of semiannually and annually……
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- Smashing Cantaloupes Inc. issued 5-year bonds with a par value of $35,000 and an 8% semiannual coupon (payable June 30 and December 31) on January 1, 2018, when the market rate of interest was 10%. Were the bonds issued at a discount or premium? Assuming the bonds sold at 92.288, what was the sales price of the bonds?A. Table below is information about three USD10000 par value bonds, each of which pays coupon semiannually. The required rate of return on each bond is 14%. Calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value. Bond Coupon Rate (%) Maturity (years) 1 8 5 2 14 10 3 16 15 B. Using the Interpolation Method to calculate the YTM for the below Bonds: > The par value USD18000 > Coupon Rate 10% every year > Maturity period 10 years > Market Value of bond USD21800A. Given below is information about three RM $5000 par value bonds, each of which pays coupon semiannually. The required rate of return on each bond is 12%. Calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value...... Bonde Coupon Rate (%)* Maturity (years) 14 10€ 5€ 24 124 10€ 34 144 15€ B. Using the above table, if the company decided to pay coupon annually (12%), calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value........ ↑. t. t. t. C. Explain the of Bons available in the market for the Companies to raise fund...... Is there any difference in the value of semiannually and annually......
- Given below is information about three RM $5000 par value bonds, each of which pays coupon semiannually. The required rate of return on each bond is 12%. Calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value..... Bonde 14 2 34 Coupon Rate (%)< 10€ 124 14€ Maturity (years) 5€ 10€ 15€ Using the above table, if the company decided to pay coupon annually (12%), calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value. ..... Explain the of Bons available in the market for the Companies to raise fund....... Is there any difference in the value of semiannually and annually....1. Below is information about three $10000 par value bonds, each of which pays coupon semiannually. The required rate of return on each bond is 14%. Calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value. Bond Coupon Rate (%) Maturity (years) 1 8 5 2 14 10 3 16 15 2. Using the Interpolation Method to calculate the YTM for the below Bonds: > The par value $18000 > Coupon Rate 10% every year > Maturity period 10 years > Market Value of bond $21800Suppose a firm is issuing 10,000 bonds. Each bond has a face amount of $950, a stated rate of 7.5%, and an 18-year term. When the bonds are issued, the market rate for similar bonds is 6.8%. What is the coupon (interest) payment of this bond? Based on the coupon (interest) payment found in (1.), what is the bond price when issued given the market rate of 6.8%? Based on your answer to (2.), explain why investors are either willing to pay more or less than the face amount of $950? How much capital does the firm raise assuming all 10,000 bonds are sold at the bond price you found in (2.)? Suppose after 8 years an investor decides to sell their bond for $925. What is the yield to maturity after 8 years given the bond price of $925? Based on the yield to maturity you calculated in (5.), is the bond at par, a premium bond, or a discount bond? Why? What is the bond price after the 8th year if the yield to maturity is 7.5%?
- Assume that a company issues a new bond with coupon rate of 11 %, 5% yield and $100 par value bond. Coupon is paid annually. The bond has three years to maturity. (1) What is the Macaulay duration of this bond? (ii) How would you interpret the result obtained in part (e)(i) above?For a company, you plan to buy the following bond: Time to maturity, 6 years; coupon rate, 8%; Coupon payment, annual; Market interest rate, 8%; Face value, $1,000. Using Excel, calculate the duration of the bond. Using Excel, calculate the accumulated value of invested payment(or receipt) when you find market interest rate a year later is now 8%, 9%, and 7%, respectively. Using Excel, calculate geometric average rate of return (or realized compound return).Below is the information about three RM1000 par value bonds that pay coupons every six months. The required rate of return on each bond is 12%. Calculate the value of the bonds and determine whether the bond is selling at discount, premium or par value. Bond Coupon Rate (%) Maturity (years) 1 10 5 2 12 10 3 14 15
- Find the total proceeds (in $) from the sale of 30 bonds with a coupon rate of 8.75 and a current price of 96.575. (Round your answer to the nearest cent.) The commission charge is $6.00 per bond. The date of the transaction is 145 days since the last interest payment. $2821.53 xAn investor gathers the following data on three newly-issued bonds: 1-year government bond, 3.0% yield 1-year ABC corporate bond, 4.2% yield 10-year government bond, 3.8% yield If investors require a 0.5% liquidity premium for corporate bonds, what are the components of the required return on a 10-year ABC bond?Kinight, Inc., has issued a 3 year bond that pays a coupon rate of 6.10% coupon payments are made semiannually.Given the market rate of interest of 5.80%, what is the market value of the bond?
