FIN 571 Week 4 Connect Problems
Q-1 Even though most corporate bonds in the United States make coupon payments semiannually , bonds issued elsewhere often have annual coupon payments . Suppose a German company issues a bond with a par value of € 1,000 , 20 years to maturity , and a coupon rate of 7 percent paid annually .
If the yield to maturity is 8.1 percent , what is the current price of the bond ? ( Do not round intermediate calculations and round your answer to 2 decimal places , e . g ., 32.16 .)
Q-1 ( Set 2 )
Watters Umbrella Corp . issued 30-year bonds 2 years ago at a coupon rate of 7.4 percent . The bonds make semiannual payments . If these bonds currently sell for 83 percent of par value , what is the YTM ? ( Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places , e . g ., 32.16 .)
2 . Microhard has issued a bond with the following characteristics :
Par : $ 1,000 Time to maturity : 15 years Coupon rate : 11 percent Semiannual payments
Calculate the price of this bond if the YTM is ( Do not round intermediate calculations and round your answers to 2 decimal places , e . g ., 32.16 .):
Q-2 ( Set 2 )
Union Local School District has bonds outstanding with a coupon rate of 3.7 percent paid semiannually and 15 years to maturity . The yield to maturity on these bonds is 4.3 percent and the bonds have a par value of $ 5,000 .
What is the dollar price of the bond ? ( Do not round intermediate calculations and round your answer to 2 decimal places , e . g ., 32.16 .)