Questions from Corporate Finance

Q: Determine the interest payment for the following three bonds: 4 ½

Determine the interest payment for the following three bonds: 4 ½ percent coupon corporate bond (paid semiannually), 5.15 percent coupon Treasury note, and a corporate zero coupon bond maturing in 15...

Q: A bond issued by Ford on May 15, 1997 is scheduled

A bond issued by Ford on May 15, 1997 is scheduled to mature on May 15, 2097. If today is November 16, 2014, what is this bond’s time to maturity?

Q: A bond issued by IBM on December 1, 1996 is scheduled

A bond issued by IBM on December 1, 1996 is scheduled to mature on December 1, 2096. If today is December 2, 2015, what is this bond’s time to maturity?

Q: Compute the expected return and standard deviation given these four economic states

Compute the expected return and standard deviation given these four economic states, their likelihoods, and the potential returns:

Q: A 6 percent corporate coupon bond is callable in five years for

A 6 percent corporate coupon bond is callable in five years for a call premium of one year of coupon payments. Assuming a par value of $1,000, what is the price paid to the bondholder if the issue...

Q: A 5.5 percent corporate coupon bond is callable in ten

A 5.5 percent corporate coupon bond is callable in ten years for a call premium of one year of coupon payments. Assuming a par value of $1,000, what is the price paid to the bondholder if the issuer...

Q: A 2 ¾ percent TIPS has an original reference CPI of 185

A 2 ¾ percent TIPS has an original reference CPI of 185.4. If the current CPI is 210.7, what is the current interest payment and par value of the TIPS?

Q: A 3 1/8 percent TIPS has an original reference CPI

A 3 1/8 percent TIPS has an original reference CPI of 180.5. If the current CPI is 206.8, what is the current interest payment and par value of the TIPS?

Q: Suppose that Papa Bell, Inc.’s, equity is currently

Suppose that Papa Bell, Inc.’s, equity is currently selling for $55 per share, with 4 million shares outstanding. If the firm also has 17 thousand bonds outstanding, which are selling at 94 percent of...

Q: Consider the following three bond quotes; a Treasury note quoted at

Consider the following three bond quotes; a Treasury note quoted at 97.844, and a corporate bond quoted at 103.25, and a municipal bond quoted at 101.90. If the Treasury and corporate bonds have a par...