80.2K

Verified Solution

Link Copied!

1. a)Consider a bond that has a price of $1121.37, a current yield of 7.13%, a yield to maturity of 7%, a face value of $1000, and 28 years to maturity. What are the annual coupon payments? (Round to 2 decimal places)

b)

Consider the following bond where the coupons are paid semi-annually,

Bond	CIBC
Price	$1040.25
YTM	3%
Years to maturity	11 years

What is the coupon rate of this bond? Enter your answer as a percentage. Do not enter the percentage sign in your answer. (round to 2 decimal places)

c) What is the price of a bond with a coupon rate of 3%, payable semi-annually, a face value of $1000, 6 years to maturity, and a yield to maturity of 2.6%? (round to 2 decimal places)

d) A 8-year, $1000 face value bond makes annual payments and has a coupon rate of 7.9 percent.

If the current yield on the bond is 7.3 percent, what is the bonds price?

e) A one year Treasury bill offers a 7.9% yield to maturity. The market's concensus forecast is that one year T-bills will offer 8.3% next year. What is the current yield on a 2 year T-bill if the expectations hypothesis holds? Enter your answer as a percentage. Do not include the percentage sign in your answer. (round to two decimal places)

Please show your work, and round to 2 decimal places! Thanks

Answer & Explanation Solved by verified expert

See Answer