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Need answers for 22 finance questions Questio...

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Need answers for 22 finance questions Question 1 ABC Corp. issued 15-year bonds 2 years ago at a coupon rate of 10.6%. The bonds make semi-annual payments. If these bonds currently sell for 97% of par value, what is the YTM? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer 1 points Question 2 ABC's bonds have a 9.5 percent coupon and pay interest semi-annually. Currently, the bonds are quoted at 106.315 percent of par value. The bonds mature in 8 years. What is the yield to maturity? Answer 1 points Question 3 The yield to maturity on a Marshall Co. premium bond is 7.6 percent. This is the: Answer nominal rate. effective rate. real rate. current yield. coupon rate. 1 points Question 4 A discount bond has a yield to maturity that: Answer exceeds the coupon rate. equals zero. is equal to the current yield. is less than the coupon rate. equals the bond's coupon rate. 1 points Question 5 BCD?s $1,000 par value bonds currently sell for $798.40. The coupon rate is 10%, paid semi-annually. If the bonds have 5 years to maturity, what is the yield to maturity? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer 1 points Question 6 The 14.8 percent, $1,000 face value bonds of Tim McKnight, Inc., are currently selling at $1,077.39. What is the current yield? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer 1 points Question 7 The rate required in the market on a bond is called the: Answer call yield risk premium liquidity premium yield to maturity current yield 1 points Question 8 You paid $1,183 for a corporate bond that has a 5.38% coupon rate. What is the current yield? Hint: if nothing is mentioned, then assume par value = $1,000 Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer 1 points Question 9 ABC has issued a bond with the following characteristics: Par: $1,000; Time to maturity: 8 years; Coupon rate: 4%; Assume semi-annual coupon payments. Calculate the price of this bond if the YTM is 7.9% Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer 1 points Question 10 ABC Inc., has $1,000 face value bonds outstanding. These bonds mature in 3 years, and have a 6.5 percent coupon. The current price is quoted at 98.59 percent of par value. Assume semi-annual payments. What is the yield to maturity? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer 1 points Question 11 ABC's Inc.'s bonds currently sell for $1,280 and have a par value of $1,000. They pay a $135 annual coupon and have a 15-year maturity, but they can be called in 5 years at $1,050. What is their yield to call (YTC)? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer 1 points Question 12 The 8 percent coupon bonds of the Peterson Co. are selling for 98 percent of par value. The bonds mature in 5 years and pay interest semi-annually. These bonds have a yield to maturity of _____ percent. Answer 1 points Question 13 Stealers Wheel Software has 9.1% coupon bonds on the market with nine years to maturity. The bonds make semi-annual payments and currently sell for 103.17% of par. What is the current yield? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer 1 points Question 14 A firm's bonds have maturity of 10 years with a $1000 face value, an 8% semi-annual coupon, are callable in 5 years, at $1,050, and currently sells at a price of $1,100. What is the yield to call (YTC)? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer 1 points Question 15 The 12.23 percent coupon bonds of the Peterson Co. are selling for $908.7. The bonds mature in 5 years and pay interest semi-annually. These bonds have current yield of _____ percent. Enter your answer in percentages rounded off to two decimal points. Answer 1 points Question 16 The principal amount of a bond that is repaid at the end of term is called the par value or the: Answer discount amount back-end amount coupon rate coupon face value 1 points Question 17 ABC has issued a bond with the following characteristics: Par: $1,000; Time to maturity: 9 years; Coupon rate: 11%; Assume semi-annual coupon payments. Calculate the price of this bond if the YTM is 11.56% Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer 1 points Question 18 A bond which sells for less than the face value is called a: Answer perpetuity. par value bond. discount bond. debenture. premium bond. 1 points Question 19 A premium bond is a bond that: Answer has a par value which exceeds the face value. has a face value in excess of $1,000. has a market price which exceeds the face value. is callable within 12 months or less. is selling for less than par value. 1 points Question 20 ABC wants to issue 11-year, zero coupon bonds that yield 11.96 percent. What price should they charge for these bonds if they have a par value of $1,000? That is, solve for PV. Assume annual compounding. Hint: zero coupon bonds means PMT = 0 Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer 1 points Question 21 Assume that you wish to purchase a 10-year bond that has a maturity value of $1,000 and a coupon interest rate of 5%, paid semiannually. If you require a 4.05% rate of return on this investment (YTM), what is the maximum price that you should be willing to pay for this bond? That is, solve for PV. Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer 1 points Question 22 ABC has issued a bond with the following characteristics: Par: $1,000; Time to maturity: 18 years; Coupon rate: 6%; Assume annual coupon payments. Calculate the price of this bond if the YTM is 7.82% Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer

 

Paper#5315 | Written in 18-Jul-2015

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