1) Find the yield to maturity on a semiannual coupon bond given that the bond price is $1128, the coupon rate is 8%, the face value is $1000, and which matures in 13 years. 

2. What is the duration of the bond in Problem 1? 

 

3.  What is the value of a 30-year semiannual coupon bond given that the coupon rate = 11%, the face value = $1000, the required return = 15%, and there are 15 years remaining until maturity?

 

4. Suppose you purchase a 25-year, $1000-face value, zero coupon bond for $357.80 when it was issued on 3/1/2018 (next day settlement). What is the bond's YTM? 

5. Consider the bond in Problem 4. What would the value of the bond be 5 years from settlement date, all else being equal? 

Kindly Find The Attached Solution.

Step-by-step explanation

F. Hero - Microsoft Excel X Home In Insert Page Layout Formulas Data Review View N P & cult A R W Calibri Wrap Text General Normal Bad Autosum - Copy Fill - Paste Format Painter BI U A =1Merge & Center % 9 08 0 Conditional Format Good Neutral Insert Delete Format Sort & Find & Formatting * as Table Clear Filter * Select Clipboard Font Alignment Number Styles Cells Editing 110 D F G H I J K L M N O Answer 1 Answer 3 2 Current Price Of Bond 1128.00 Face Value 1000 Face Value 1000 Componding In Year 4 Componding In Year Coupon Rate 11.00% 5 Coupon Rate 3.00% Tenure 15 6 Tenure 13 No of Periods 30 7 No of Periods 26 Coupon S 55 8 Coupon $ 40 Redemtion Value 1000 9 Redemtion Value 1000.00 YTM 15.000% 10 YTM Periodic Rate 3.262% Periodic YTM 7.500% 11 YTM Annual 6.52% Current Price of Bond 763.79 12 13 Answer 2 Answer 4 14 Tenure In Years 13 Current Price Of Bond, BO 357.80 15 Settlement Date = Today 11-Mar-22 Face Value , FV 1000 16 Maturity Date 11-Mar-35 Tenure ,n 25 17 Componding In Year YTM =((FV/BO)^(1/n))-1 4.20% 18 Coupon Rate 5.00% 19 YTM 6.52% Answer5 20 Duration 8.61 Face Value , FV 1000 21 Tenure , 20 22 YTM 4.20% 23 Price Of Bond= FV/(1+r)^n 439.45 24 14 4 /Sheet49 /Sheet50 Sheet52 /Sheet53 /Sheet54 / Sheet56 / Sheet57 / Sheet58 /Sheet59 Sheet60 Ready 100% 4 x 1 15:38 11-03-2022 1 Hero - Microsoft Excel X Home art Page Layout Formulas Data Review View Define Name Trace Precedents Show Formulas f Use in Formula Calculate Now Insert AutoSum Recently Financial Logical Text Date & Lookup & Math & More Trace Dependents Error Checking Name Calculation Calculate Sheet Function Used Time Reference * Trig * Functions . Manager Create from Selection Remove Arrows Evaluate Formula | Window Options Function Library Defined Names Formula Auditing Calculation C5 A B D E Answer 1 Answer 3 2 Current Price Of Bond 1128 Face Value 1000 Face Value 1000 Componding In Year 12 4 Componding In Year 2 Coupon Rate 0.1 5 Coupon Rate 0.0 Tenure 15 6 Tenure 3 No of Periods E5*E3 7 No of Periods =B6*B4 Coupon $ =((E2*E4)/E3) 8 Coupon $ ((B3*B5)/B4) Redemtion Value 1000 9 Redemtion Value 1000 YTM 0.15 10 YTM Periodic Rate =RATE(B7,-B8,B2,-B9) Periodic YTM =E9/E3 11 YTM Annual =B10* B4 Current Price of Bond =PV(E10,E6,-E7,-E8) 12 13 Answer 2 Answer 4 14 Tenure In Years 13 Current Price Of Bond, BO 357.8 15 Settlement Date = Today 4463 Face Value , FV 1000 16 Maturity Date 49379 Tenure ,n 15 17 Componding In Year 2 YTM =((FV/BO)^(1/n))-1 =((E15/E14)^(1/E16))-1 18 Coupon Rate 0.08 19 YTM =B11 Answer 5 20 Duration =DURATION(B15,B16,B18,B19,B17) Face Value , FV 1000 21 Tenure ,n =25-5 22 YTM -F17 23 Price Of Bond= FV/(1+r)^n =E20/(1+E22)^E21 24 14 4 1 / Sheet49 /Sheet50 Sheet52 / Sheet53 / Sheet54 / Sheet56 /Sheet57 / Sheet58 /Sheet59 Sheet60 Ready 100% CO ENG 4 x t 15:38 11-03-2022