SHOW Formula

AB D E F G H L M M 1 2 Q4 As an investor, you are considering an investment in new bonds being issued by Wayne Enterprises. The bonds pay interest semiannually, mature in 20 years, and have a coapon rate of 8.1% with a par value of $1,000. The bonds have a quoted price of 86.84. (Remember that bonds are quoted as a percent of par value) Wayne Enterprises Bonds Quoted Price 86.84 Par Value $1,000.00 Coupon Rate Payment Frequency Settlement Date 10/14/2021 Maturity Date 10/14/2041 8.1% 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 LA If you could get a 3.6% yield to maturity on bonds with a similar level of risk as the Wayne Enterprises bonds, what is the highest price you would be willing to pay for them? 3.6% Required Return Valuation If you were to purchase this bond at the quoted price, what would your yield to maturity be? Yield to Maturity What are the Macauley and Modified Durations for this bond based on its current yield to maturity? Macauley Duration Modified Duration Construct a line chart showing the relationship between yield and price for this bond using the following yields. Price Place chart here Yield Directions 91 92 93 Construct a line chart showing the relationship between yield and price for this bond using the following yields. Price Place chart here 31 32 33 34 35 36 37 38 39 40 41 AZ 43 44 45 46 47 48 4 50 51 52 53 54 55 56 57 51 35 Yield 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 15% 16 17% 18N 19 20% 21% 22 23 24 25% 61