QUESTION 14

BA Corp is issuing a 10 year bond with a coupon rate of 8 percent and a par value of $1,000. The market interest rate on similar bonds is currently 6 percent. If the coupon payments are made annually, what is the value of this bond?

5 points

QUESTION 15

Knight, Inc. has issued a 3 year bond with a $1,000 par value and an annual coupon rate of 6 percent. The current market rate of interest is 5 percent. What is the value of this bond if the coupon payments are made semiannually?

5 points

QUESTION 16

Regatta, Inc., has bonds outstanding that pay an 8.250 percent coupon rate on a $1,000 face value. Investors buying the bond today can expect to earn a yield to maturity of 6.875 percent. How many years until the bonds mature if the current value of the bonds is $1,056.57 and payments are made annually?

5 points

QUESTION 17

Diane Carter is interested in buying a 5 year zero coupon bond with a face value of $5,000. If the market interest rate on these types of bonds is currently 9 percent, what is the current price of this bond?

5 points

QUESTION 18

Diane Carter is interested in buying a 5 year zero coupon bond with a face value of $5,000. If the current market value of the bond is $3,104.61, what is the bond's yield to maturity?

5 points

QUESTION 19

Rudy Sandberg wants to invest in 5 year bonds that are currently priced at $850.00. The bonds have a coupon rate of 10 percent and semiannual coupon payments. If the par value of the bonds is $1,000, what is the bond's effective annual yield (EAY)?

5 points

QUESTION 20

You own a 5 year bond with a face value of $1,000 and a coupon rate of 5 percent with annual payments. The bond is currently worth $810.46. If market interest rates remain unchanged, what will be the value of the bond next year when there are 4 years left until maturity?