Chrome File Edit View History Bookmarks Profiles Tab Window Help 49% Mon Feb 6 9:12 PM : QE Assignments: FIN3414-23Sprir X Question 3 - Chapter 5 Homew X Question 5 - Chapter 18 Home x Question 12 - Chapter 6 Home X Course Hero X + ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddlewa... M Gmail YouTube Maps Quiz: Module 3 Q... Syllabus for AST2... Chapter 5 Homework i Saved Help Save & Exit Submit Check my work 3 Lei Corporation has bonds on the market with 10.5 years to maturity, a YTM of 7.1 percent, a par value of $1,000, and a current price of $1,051. The bonds make semiannual payments. What must the coupon rate be on these bonds? (Do not round 9.09 intermediate calculations and enter your answer as a percent rounded to 2 decimal points places, e.g., 32.16.) Skipped Coupon rate |% eBook Print References Mc 202 3 of 11 Hill 6 200m screen ShotChrome File Edit View History Bookmarks Profiles Tab Window Help 49% Mon Feb 6 9:12 PM : QE Assignments: FIN3414-23Sprir X Question 4 - Chapter 5 Homew X Question 5 - Chapter 18 Home x Question 12 - Chapter 6 Home X Course Hero X + C a ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddlewa... M Gmail YouTube Maps Quiz: Module 3 Q... Syllabus for AST2... Chapter 5 Homework i Saved Help Save & Exit Submit Check my work 4 Miller Corporation has a premium bond making semiannual payments. The bond has a coupon rate of 12 percent, a YTM of 10 percent, and 18 years to maturity. The Modigliani Company has a discount bond making semiannual payments. This bond has a coupon 9.09 rate of 10 percent, a YTM of 12 percent, and also has 18 years to maturity. Both bonds points have a par value of $1,000. a. What is the price of each bond today? (Do not round intermediate calculations and eBook round your answers to 2 decimal places, e.g., 32.16.) b. If interest rates remain unchanged, what do you expect the price of these bonds to be Hint year from now? In 9 years? In 13 years? In 17 years? In 18 years? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Print References Miller Bond Modigliani Bond . ................... a. Price today b. |Price in 1 year Price in 9 years Price in 13 years Price in 17 years Price in 18 years Mc 202 Hill 6 atv 200m screen ShotChrome File Edit View History Bookmarks Profiles Tab Window Help 49% Mon Feb 6 9:12 PM : QE Assignments: FIN3414-23Sprir X Question 6 - Chapter 5 Homew X Question 5 - Chapter 18 Home x Question 12 - Chapter 6 Home X Course Hero X + C a ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddlewa... M Gmail YouTube Maps Quiz: Module 3 Q... Syllabus for AST2... Chapter 5 Homework i Saved Help Save & Exit Submit Check my work 6 Laurel, Inc., and Hardy Corp. both have 6 percent coupon bonds outstanding, with semiannual interest payments, and both are currently priced at the par value of $1,000. The Laurel, Inc., bond has five years to maturity, whereas the Hardy Corp. bond has 18 9.09 years to maturity. points a. If interest rates suddenly rise by 2 percent, what is the percentage change in the price Skipped of each bond? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) eBook b. If rates were to suddenly fall by 2 percent instead, what would be the percentage change in the price of each bond? (Do not round intermediate calculations and enter Hint your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Print References a. Percentage change in price of Laurel, Inc., bond % Percentage change in price of Hardy Corp. bond % b. |Percentage change in price of Laurel, Inc., bond % Percentage change in price of Hardy Corp. bond % Mc 202 6 of 11 Hill 6 atv 200m screen ShotChrome File Edit View History Bookmarks Profiles Tab Window Help 49% Mon Feb 6 9:13 PM : QE Assignments: FIN3414-23Sprir X Question 8 - Chapter 5 Homew X Question 5 - Chapter 18 Home X Question 12 - Chapter 6 Home X Course Hero X + ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddlewa... M Gmail YouTube Maps Quiz: Module 3 Q... Syllabus for AST2... Chapter 5 Homework i Saved Help Save & Exit Submit Check my work 8 Stuart Software has 9.6 percent coupon bonds on the market with 20 years to maturity. The bonds make semiannual payments and currently sell for 107.6 percent of par. 9.09 a. What is the current yield on the bonds? (Do not round intermediate calculations and points enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the YTM of the bonds? (Do not round intermediate calculations and enter Skipped your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What is the effective annual yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) eBook Hint a. Current yield % Print b. YTM % References C. Effective annual yield % Mc 202 8 of 11 Hill 6 atv 200m screen ShotChrome File Edit View History Bookmarks Profiles Tab Window Help 49% Mon Feb 6 9:13 PM : QE Assignments: FIN3414-23Sprir X Question 7 - Chapter 5 Homew X Question 5 - Chapter 18 Home x Question 12 - Chapter 6 Home X Course Hero X + C a ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddlewa... M Gmail YouTube Maps Quiz: Module 3 Q... Syllabus for AST2... Chapter 5 Homework i Saved Help Save & Exit Submit Check my work 7 The Faulk Corp. has a bond with a coupon rate of 3 percent outstanding. The Gonas Company has a bond with a coupon rate of 9 percent outstanding. Both bonds have 12 years to maturity, make semiannual payments, and have a YTM of 6 percent. 9.09 points a. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds? (A negative answer should be indicated by a minus sign. Do not Skipped round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. What if rates suddenly fall by 2 percent instead? (Do not round intermediate eBook calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Hint Print References a. Percentage change in price of Faulk Corp. bond % Percentage change in price of Gonas Co. bond % b. Percentage change in price of Faulk Corp. bond % Percentage change in price of Gonas Co. bond % Mc 202 Hill 6 atv 200m screen ShotChrome File Edit View History Bookmarks Profiles Tab Window Help 49% Mon Feb 6 9:14 PM : QE Assignments: FIN3414-23Sprir X Question 9 - Chapter 5 Homew X Question 5 - Chapter 18 Home x Question 12 - Chapter 6 Home X Course Hero X + C a ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddlewa... M Gmail YouTube Maps Quiz: Module 3 Q... Syllabus for AST2... Chapter 5 Homework i Saved Help Save & Exit Submit Check my work 9 Baxter Co. wants to issue new 17-year bonds for some much-needed expansion projects. The company currently has 10 percent coupon bonds on the market that sell for $1,050, make semiannual payments, and mature in 17 years. Both bonds have a par value of 9.09 $1,000. What coupon rate should the company set on its new bonds if it wants them to points sell at par? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Skipped Coupon rate |% eBook Print References Mc 202 6 atv 200m screen ShotChrome File Edit View History Bookmarks Profiles Tab Window Help 48% Mon Feb 6 9:14 PM : QE Assignments: FIN3414-23Sprir X Question 10 - Chapter 5 Home X Question 5 - Chapter 18 Home x Question 12 - Chapter 6 Home X Course Hero X + C a ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddlewa... M Gmail YouTube Maps Quiz: Module 3 Q... Syllabus for AST2... Chapter 5 Homework i Saved Help Save & Exit Submit Check my work 10 Treasury bills are currently paying 6 percent and the inflation rate is 3 percent. a. What is the approximate real rate of interest? (Do not round intermediate 9.09 calculations and enter your answer as a percent rounded to 2 decimal places, e.g., points 32.16.) b. What is the exact real rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) eBook Print a. Approximate real rate :% References Exact real rate % Mc 202 Hill 6 atv 200m screen ShotChrome File Edit View History Bookmarks Profiles Tab Window Help 48% Mon Feb 6 9:14 PM : QE Assignments: FIN3414-23Sprir X Question 11 - Chapter 5 Homev X Question 5 - Chapter 18 Home x Question 12 - Chapter 6 Home X Course Hero X + C a ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddlewa... M Gmail YouTube Maps Quiz: Module 3 Q... Syllabus for AST2... Chapter 5 Homework i Saved Help Save & Exit Submit Check my work 11 An investment offers a total return of 10 percent over the coming year. Powell Arms thinks the total real return on this investment will be only 5 percent. What does Powell believe the inflation rate will be over the next year? (Do not round intermediate 9.09 calculations and enter your answer as a percent rounded to 2 decimal places, e.g., points 32.16.) Skipped Inflation rate % eBook Print References Mc 202 6 atv screen Shot WF Zoom