1A) A $10,000, 8% annual coupon bond will mature in 10 years.
What is the price of this bond if the current yield to maturity on
bonds of similar risk and maturity is 7.2%?
a.
$10,956
b.
$9,463
c.
$10,557
d.
$10,000
1B) What is the intrinsic value of a $10,000, 8% annual coupon
bond with a current yield to maturity of 7.2% and which will mature
in 10 years if the coupon payments are
made semi-annually?
a.
$6,662
b.
$10,563
c.
$10,834
d.
$10,557
1C) If the price of a $10,000, 8% semiannual coupon bond
maturing in 10 years is $9,350, what is its yield to maturity?
a.
7.20%
b.
9.00%
c.
9.35%
d.
4.50%
1D) A 10%, $1,000, 15-year bond is callable in 10 years at 110%
par. It is currently selling for $980. What is its yield to call?
(we didn't discuss this in class, but it is in the reading)
a.
10.61%
b.
10.27%
c.
10.57%
d.
10.94%