bond max price

Related BrainMass Solutions

• Interest Rates, YTM, Options, Stocks, Bonds

  0.50 =Max(50-25, 0 ) =25.5-25 (2) What happens to the time value as the stock price rises?

• Calculate the cost of equity for Dell Corp.

  When you calculate the bond price, you need to use the annual coupon, and the time to maturity.

• Finance: Coupon Rates

  If the bond currently sells for $1,145.70, what is the YTM? 5. MAX Enterprises has bonds on the market making annual payments, with 16 years to maturity and selling for $963. At this price, the bonds yield 7.5 percent.

• Convertible Bonds

  of bond Value of bond= $597.24 Thus the maximum of the conversion value and bond value= $597.24 =MAX ( 256. , 597.24 ) Answer: the minimum value of the bond= $597.24 b.

• Calculating a European Call Option

  The value of the call at expiration on the higher interest rate state is C1,H = max[0, PH -100] = max[0, 98.48 -100] = 0.

• backward induction

  The value of the call at expiration on the higher interest rate state is C1,H = max[0, PH -100] = max[0, 98.48 -100] = 0.

• Convertible Bonds

  For each of the stock prices given in part b, at what price would you expect the bond Price of a convertible bond = max (Conversion value, Straight Value) + Option value (also called premium)

• The James Bond Fund

  In anticipation of a rapid increase in interest rates and a subsequent economic downturn, the investment committee has decided to minimize the fund's exposure to bond price fluctuations.

• Stock Trading: Payoff of a Call

  Payoff for a call option = Max (0, Stock Price - Exercise Price ) Stock Price = $35.00 Exercise (Strike) Price = $40.00 Therefore Payoff = $0.00 MAX(0,35-40) Answer: Payoff for call =$0.00 c.