You read in The Wall Street Journal that day Tbills are currently yielding Your brotherinlaw, a broker at Safe and Sound Securities, has given you the following estimates of current interest rate premiums:
Inflation Premium IP
Liquidity Premium LP
Maturity Risk Premium MRP
Default Risk Premium DRP
On the basis of these data, what is the real riskfree rate of return?
Madsen Motors's bonds have years remaining to maturity. Interest is paid annually, they have a $ par value, the coupon interest rate is and the yield to maturity is What is the bond's current market price?
A bond has $ par value, years to maturity, and annual coupon and sells for $
a What is its yield to maturity YTM
b Assume the yield to maturity remains constant for the next three years. Wat will the price be years from today?
