Question: Please see the attached assignment I need help with. Please show the step-by-step process in how calculations are done and include how to compute in

Please see the attached assignment I need help with. Please show the step-by-step process in how calculations are done and include how to compute in Excel. Thank you!!

International Business Machines Corps (NYSE: ARCA: IBM42) Last price: 93.360 Day Change : +18.300 1.99% Bid: 0 Bid Size: 0 Ask: 0 Thurs Sep 24, 2015. 12:19 PM/USD/delayed High: 93.360 Low: 93.360 Volume: 0 Previous Close: 91.530 Previous Close date: 09/23/15 Coupon Rate: 4.000 Maturity Date: 06-20-2042 Issue Type: Corporate Bond CUSIP: 459200HF1 Taking the following quote listed above which can be found on the www.nyse.com website, by going to \"trade\" then click on \"bonds\" then \"search bond directory.\" In the window \"bond issuer\" type in IBM and click \"GO.\" Please answer the following questions and show your work. 1. Assume that par value of the bond is $1,000. What was the last price of the bond in $$$ (listed in Last Trade Price)? 2. Assume that par value of the bond is $1,000. Calculate annual coupon interest payments. 3. Assume that par value of the bond is $1,000. Calculate current yield of the bond. 4. Assume that par value of the bond is $1,000. Assume annual coupon payments. Calculate YTM of the bond using the last price (listed in Last Trade Price). (Round the number of years to the whole number). Show your work. 5. Describe one major shortcoming for YTM and current yield. How would the following affect the yield on newly issued bond? Please explain your answer. a) The bonds are callable. b) The bonds are subordinated to the existing bond issue. c) The bond rating is better or worse than the Moody's Aa3 that IBM anticipates
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
