Calculate the value of each of the bonds shown in the following table, all of which pay interest annually.

Bond	Par value	Coupon interest rate	Years to maturity	Required return
A	$1,000	14%	20	12%
B	1,000	8	16	8
C	100	10	8	13
D	500	16	13	18
E	1,000	12	10	10

Problem P6-16
A.
Settlement		(Think of Settlement as the beginning of the duration of the bond)
Maturity		(Think of Maturity as the end of the duration of the bond)
Rate		(Coupon Rate)
YTM		(Yield to Maturity or Required Rate for Return)
Redemption		(Bonds Face Value, Par Value, or Fair Price; Note that is is $100, not $1,000. You make the adjustments by multiplying the answer by 10.)
Frequency		(Coupon payments are semi-annul, so you put in a 2. If they are annual, then you input a 1)
Basis		(Always leave it blank)
Bond Price:		(The answer. But you need to multiply it by 10 to get the actual bond price.)
Multiply by 10		(Microsoft gives the bond price in 2 digits like in cell B111. You need to multiply it by 10 to get the actual bond price)
B.
Settlement		(Think of Settlement as the beginning of the duration of the bond)
Maturity		(Think of Maturity as the end of the duration of the bond)
Rate		(Coupon Rate)
YTM		(Yield to Maturity or Required Rate for Return)
Redemption		(Bonds Face Value, Par Value, or Fair Price; Note that is is $100, not $1,000. You make the adjustments by multiplying the answer by 10.)
Frequency		(Coupon payments are semi-annul, so you put in a 2. If they are annual, then you input a 1)
Basis		(Always leave it blank)
Bond Price:		(The answer. But you need to multiply it by 10 to get the actual bond price.)
Multiply by 10		(Microsoft gives the bond price in 2 digits like in cell B111. You need to multiply it by 10 to get the actual bond price)
C.
Settlement		(Think of Settlement as the beginning of the duration of the bond)
Maturity		(Think of Maturity as the end of the duration of the bond)
Rate		(Coupon Rate)
YTM		(Yield to Maturity or Required Rate for Return)
Redemption		(Bonds Face Value, Par Value, or Fair Price; Note that is is $100, not $1,000. You make the adjustments by multiplying the answer by 10.)
Frequency		(Coupon payments are semi-annul, so you put in a 2. If they are annual, then you input a 1)
Basis		(Always leave it blank)
Bond Price:		(Note: You will not multiply by 10 since the par value is $100)
Multiply by 10
D.
Settlement		(Think of Settlement as the beginning of the duration of the bond)
Maturity		(Think of Maturity as the end of the duration of the bond)
Rate		(Coupon Rate)
YTM		(Yield to Maturity or Required Rate for Return)
Redemption		(Bonds Face Value, Par Value, or Fair Price; Note that is is $100, not $1,000. You make the adjustments by multiplying the answer by 10.)
Frequency		(Coupon payments are semi-annul, so you put in a 2. If they are annual, then you input a 1)
Basis		(Always leave it blank)
Bond Price:		(The answer. But you need to multiply it by 10 to get the actual bond price.)
Multiply by 10		(Note: You will only multiply by 5 since the par value is $500)
E.
Settlement		(Think of Settlement as the beginning of the duration of the bond)
Maturity		(Think of Maturity as the end of the duration of the bond)
Rate		(Coupon Rate)
YTM		(Yield to Maturity or Required Rate fo Return)
Redemption		(Bonds Face Value, Par Value, or Fair Price; Note that is is $100, not $1,000. You make the adjustments by multiplying the answer by 10.)
Frequency		(Coupon payments are semiannul, so you put in a 2. If they are annual, then you input a 1)
Basis		(Always leave it blank)
Bond Price:		(The answer. But you need to multiply it by 10 to get the actual bond price.)
Multiply by 10		(Microsoft gives the bond price in 2 digits like in cell B111. You need to multiply it by 10 to get the actual bond price)

Answer rating: 100% (QA)

A B C D E F G H I 2 Bond A 3 Settlement 112018 DATE201811 4 Maturity 112038 DATE20182011 5 Rate 14 6 ... View the full answer