BUS124 - HW - CH19 S 3 Bonds

Question 1:

Use the table below to find the cost of buying 30 bonds at the last price if the commission is $6 per bond.

Company (ticker) - Company A

Coupon - 5.000

Maturity - Jul 15, 2041

Last price - 91.774

Last yield - 4.359

EST $ VOL (000's) - 242,841

The total cost is ? (type integer or a decimal)

Question 2:

Use the table below to find the following information for Company A bonds maturing in 2019.

Annual interest

Company (Ticker) - Company A

Coupon - 2.030

Maturity - May 21, 2019

Lsat price - 114.777

Last Yield - 4.160

EST & VOL (000's) - 245,339

The annual interest is $ (Type integer or a decimal)

Question 3:

Assume you are trying to estimate the price you will pay for a bond. The face value is$1000, the coupon rate of interest paid annually is10%, the bonds mature in 25 years and are currently priced to yield 12

A - 1126.40

B - 1000

C - 58.82

D - 843.14

Compute the present value of the bonds today(hint you must compute the annual interest payment using the coupon rate and the yield rate will be yourI/Y)

Question 4:

Assume you are trying to estimate the price you will pay for a bond. The face value is$1000, the coupon rate of interest paidsemi-annually is10%, the bonds mature in 25 years and are currently priced to yield12%

A - 58.82

B - 1000

C - 1126.40

D - 842.38

Compute the present value of the bonds today(hint you must compute the annual interest payment using the coupon rate and the yield rate will be yourI/Y)

Question 5:

Assume you are a finance broker who is investing in bonds. The bond par value is$1,000, is a 20 year bond and the coupon rate is8% paying interest annually. If the bonds are priced to yield7.25%, how much would you expect to pay for the bond(without consideringcommission).

A - 162.06

B - 684.00

C - 1,077.93

D - 1,000.00

Feedback will be left accordingly.

Thanks!