Questions from General Investment

Q: A zero-coupon bond that matures in 15 years is currently

A zero-coupon bond that matures in 15 years is currently selling for $209 per $1,000 par value. What is the promised yield on this bond?

Q: What is the price of a zero-coupon ($1,

What is the price of a zero-coupon ($1,000 par value) bond that matures in 20 years and has a promised yield of 9.5%?

Q: Assume that an investor pays $800 for a long-term

Assume that an investor pays $800 for a long-term bond that carries an 8% coupon. In three years, he hopes to sell the issue for $950. If his expectations come true, what yield will this investor real...

Q: A bond has a Macaulay duration equal to 9.5 and

A bond has a Macaulay duration equal to 9.5 and a yield to maturity of 7.5%. What is the modified duration of this bond?

Q: An investor wants to find the duration of a 25-year

An investor wants to find the duration of a 25-year, 6% semiannual-pay, noncallable bond that’s currently priced in the market at $882.72, to yield 7%. Using a 50 basis point change...

Q: Given the information in Figure 6.4, answer the following

Given the information in Figure 6.4, answer the following questions for Abercrombie & Fitch Co. a. On what day did the trading activity occur? b. At what price did the stock sell when the market close...

Q: You have the opportunity to purchase a 25-year, $

You have the opportunity to purchase a 25-year, $1,000 par value bond that has an annual coupon rate of 9%. If you require a YTM of 7.6%, how much is the bond worth to you?

Q: A 20-year bond has a coupon of 10% and

A 20-year bond has a coupon of 10% and is priced to yield 8%. Calculate the price per $1,000 par value using semiannual compounding. If an investor purchases this bond two months before a scheduled co...

Q: Three years ago you purchased a 10% coupon bond that pays

Three years ago you purchased a 10% coupon bond that pays semiannual coupon payments for $975. What would be your bond equivalent yield if you sold the bond for current market price of $1,050?

Q: A bond is priced in the market at $1,150

A bond is priced in the market at $1,150 and has a coupon of 8%. Calculate the bond’s current yield.