Purchase Solution

What is the price of a bond that matures in ten years, has a face value of 1,000 dollars (the principal to be repaid at the end of ten years) and a coupon rate of 7 percent and a current yield of 10 percent. Interest payments are semi-annual.

Not what you're looking for?

Ask Custom Question

What is the price of a bond that matures in ten years, has a face value of 1,000 dollars (the principal to be repaid at the end of ten years) and a coupon rate of 7 percent and a current yield of 10 percent. Interest payments are semi-annual.

Purchase this Solution
Solution Summary

Computation done by hand using formula is examined.

Purchase this Solution
Free BrainMass Quizzes
Production and cost theory

Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.

Six Sigma for Process Improvement

A high level understanding of Six Sigma and what it is all about. This just gives you a glimpse of Six Sigma which entails more in-depth knowledge of processes and techniques.

Situational Leadership

This quiz will help you better understand Situational Leadership and its theories.

Business Processes

This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.

SWOT

This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.

View More Free Quizzes
Related BrainMass Solutions

  • Describing the Features of the Bond

    The bonds are callable at a price equal to the present value of all future interest and principal payments discounted at a rate equal to the comparable Treasury rate plus 0.50 percent.

  • Valuing bond and preferred stock

    330177 Bonds and Stocks 1. Rick bought a bond when it was issued by Macroflex Corporation 14 years ago. The bond, which has a $1,000 face value and coupon rate equal to 10 percent, matures in six years.

  • Time Value of Money, Bonds

    Show that the loan balance after 1 year is equal to the year-end payment of $301.92 times the 3-year annuity factor. 3. Bond Yields. A bond with face value $1,000 has a current yield of 7 percent and a coupon rate of 8 percent.

  • Present Value problems

    An AT&T bond has 10 years until maturity, a coupon rate of 8 percent, and sells for $1,100. a. What is the current yield on the bond? b. What is the yield to maturity? Bond Prices and Yields. a.

  • Bonds:YTM, YTC, PV, value, current yield, capital gain yield

    Bond YTC 2 What is the yield to call of a bond which can be called in five years at $1,020 and has the following structure: semi-annual payments, 7.10% coupon rate, $1,000 par value, remaining maturity 25 years, and market price $968.64? 7.

  • Estimating the values of various securities

    Locust has a bond outstanding that matures in 18.5 years and pays an 8.5 percent coupon. The bond pays interest semiannually. The bond has a par value of $1,000 and a market price of $1,007.44. Interest is paid semi-annually.

  • Dividend yield, YTM, YTC

    A $1,000 par value bond sells for $1,216.  It matures in 20 years, has a 14 percent coupon, pays interest semiannually, and can be called in 5 years at a price of $1,100.  What is the bond's YTM and YTC?   

  • Bond Calculations

    If you purchase a zero coupon bond today for $225 and it matures at $1,000 in 11 years, what rate of return will you earn on that bond (to the nearest 10th of 1 percent)? 8. AT&T Corporation has several issues of bonds outstanding.

  • TVM, Bonds (pricing, yields)

    6) Bond Yields. An AT&T bond has 10 years until maturity, a coupon rate of 8 percent, and sells for $1,100. a.What is the current yield on the bond? b.What is the yield to maturity? 7) Bond Prices and Yields.

View More Related Solutions