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1) A bond that has a face value of $3,000 and coupon rate of 3

Finance

1) A bond that has a face value of $3,000 and coupon rate of 3.90% payable semi-annually was redeemable on July 1, 2021. Calculate the purchase price of the bond on February 10, 2015 when the yield was 4.40% compounded semi-annually.

 

 

2.A $5,500 bond that carries a 3.50% coupon rate payable semi-annually is purchased 6 years before maturity when the yield rate was 5.00% compounded semi-annually.

a. Calculate the purchase price of the bond.

$

Round to the nearest cent

b. What is the amount of discount or premium on the bond?

 

 

3Raymond purchased a $3,000 bond that was paying a coupon rate of 6.70% compounded semi-annually and had 4 more years to mature. The yield at the time of purchase was 5.20% compounded semi-annually.

a. How much did Raymond pay for the bond?

Round to the nearest cent

b. What was the amount of premium or discount on the bond?

 

 

4.A $7,000 bond had a coupon rate of 5.50% with interest paid semi-annually. Victoria purchased this bond when there were 6 years left to maturity and when the market interest rate was 5.75% compounded semi-annually. He held the bond for 2 years, then sold it when the market interest rate was 5.25% compounded semi-annually.

a. What was the purchase price of the bond?

Round to the nearest cent.

b. What was the selling price of the bond?

Round to the nearest cent.

c. What was Victoria's gain or loss on this investment?

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