Please answer all questions, do not leave any question unanswered. You can submit this to me at the beginning of class or through Moodle, your choice. Typed answers are preferred but not required. Homework is Due on 11/12/2019.
A company would call its outstanding callable bonds if:
If a 15-year bond with a face value of $1,000 currently sells for $850, then
You are considering two bonds. Bond A has a 8% annual coupon while Bond B has a 5% annual coupon. Both bonds have a 6% yield to maturity, and the YTM is expected to remain constant. If that is the case, then it must be true that:
Morin Company’s bonds mature in 8 years, have a par value of $1,000, and make an annual coupon interest payment of $65. The market requires an interest rate of 6.1% on these bonds. What is the bond’s price?
The companyâ€s bonds are downgraded.
Market interest rates rise sharply.
The company’s financial situation deteriorates significantly.
Market interest rates decline sharply.
The bondâ€s coupon rate exceeds its current yield.
The bondâ€s current yield exceeds its yield to maturity.
The bondâ€s yield to maturity is greater than its coupon rate.
The bondâ€s current yield is equal to its coupon rate.
If the yield to maturity stays constant until the bond matures, the bondâ€s price will remain at $850.
The price of Bond B will decrease over time, but the price of Bond A will increase over time.
The prices of both bonds will remain unchanged.
The price of Bond A will decrease over time, but the price of Bond B will increase over time.
The prices of both bonds will increase by 7% per year.
The prices of both bonds will increase over time, but the price of Bond A will increase at a faster rate.
Problems: Show your work
Nungesser Corporationâ€s outstanding bonds have a $1,000 par value, an 8% semiannual coupon, 14 years to maturity, and an 11% YTM. What is the bondâ€s price?
Callaghan Motorsâ€ bonds have 23 years remaining to maturity. Interestis paid annually, they have a $1,000 par value, the coupon interest rate is 9%, and the yield to maturity is 11%. What is the bondâ€s current market price?
A bond has a $1,000 par value, 12 years tomaturity, and an 8% annual coupon and sells for $980. What is its yield to maturity (YTM)?
A firmâ€s bonds have a maturity of 8 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 4 years at $1,154, and currently sell at a price of $1,283.09 What are their nominal yield to maturity and their nominal yield to call?
Do you need a similar assignment done for you from scratch? We have qualified writers to help you. We assure you an A+ quality paper that is free from plagiarism. Order now for an Amazing Discount! Use Discount Code “Newclient” for a 15% Discount!NB: We do not resell papers. Upon ordering, we do an original paper exclusively for you.
The post homework in finance appeared first on The Nursing TermPaper.