Questions from General Investment

Q: Caleb buys an 8.75% corporate bond with a current

Caleb buys an 8.75% corporate bond with a current yield of 5.6%. When he sells the bond 1 year later, the current yield on the bond is 6.6%. How much did Caleb make on this investment?

Q: Rhett purchased a 13%, zero-coupon bond with a 15

Rhett purchased a 13%, zero-coupon bond with a 15-year maturity and a $20,000 par value 15 years ago. The bond matures tomorrow. How much will Rhett receive in total from this investment, assuming all...

Q: Nate purchased an interest-bearing security last year, planning to

Nate purchased an interest-bearing security last year, planning to hold it until maturity. He received interest payments and, to his surprise, a sizable amount of the principal was paid back in the fi...

Q: A certain bond has a current yield of 6.5%

A certain bond has a current yield of 6.5% and a market price of $846.15. What is the bond’s coupon rate?

Q: Using settlement or closing prices from Figures 15.3 and 15

Using settlement or closing prices from Figures 15.3 and 15.4, find the value of the following commodities and financial futures contracts. Figures 15.3: Figures 15.4: a. March 2013 corn b. July...

Q: Buck buys a 7.5% corporate bond with a current

Buck buys a 7.5% corporate bond with a current yield of 4.8%. How much did he pay for the bond?

Q: You are considering the purchase of a $1,000 par

You are considering the purchase of a $1,000 par value bond with an 6.5% coupon rate (with interest paid semiannually) that matures in 12 years. If the bond is priced to provide a required return of 8...

Q: You notice in the WSJ a bond that is currently selling in

You notice in the WSJ a bond that is currently selling in the market for $1,070 with a coupon of 11% and a 20-year maturity. Using annual compounding, calculate the promised yield on this bond.

Q: A bond is currently selling in the market for $1,

A bond is currently selling in the market for $1,098.62. It has a coupon of 9% and a 20-year maturity. Using annual compounding, calculate the yield to maturity on this bond.

Q: You are evaluating an outstanding issue of $1,000 par

You are evaluating an outstanding issue of $1,000 par value bonds with an 8.75% coupon rate that mature in 25 years and make quarterly interest payments. If the current market price for the bonds is $...