A $1,000 par value bond with a coupon interest rate of 12.8 percent per year paid semiannually matures in 25 years. Draw a CF diagram corresponding to this information and then complete the table below by filling in the prices and YTMs that correspond to the given YTM’s and prices respectively. Show all the work for part D – both the PVAt and PV calculations. Then check your answer using your calculator’s TVM solver menu or function keys. PRICE YTM A. ______________ ___0%____ B. __$1,000______ __________ C. __$ 917.19_____ __________ D. ______________ ___16%____

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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1. (Bond Valuation Problem) A $1,000 par value bond with a coupon interest rate of 12.8 percent per year paid semiannually matures in 25 years. Draw a CF diagram corresponding to this information and then complete the table below by filling in the prices and YTMs that correspond to the given YTM’s and prices respectively. Show all the work for part D – both the PVAt and PV calculations. Then check your answer using your calculator’s TVM solver menu or function keys. PRICE YTM A. ______________ ___0%____ B. __$1,000______ __________ C. __$ 917.19_____ __________ D. ______________ ___16%____
1. Bond Valuation Problem) A $1,000 par value bond with a coupon interest rate of 12.8
percent per year paid semiannually matures in 25 years. Draw a CF diagram
corresponding to this information and then complete the table below by filling in the
prices and YTMS that correspond to the given YTM's and prices respectively. Show all
the work for part D-both the PVA and PV calculations. Then check your answer using
your calculator's TVM solver menu or function keys.
PRICE
YTM
А.
0%
B. $1.000
C. $917.19
D.
16%
Transcribed Image Text:1. Bond Valuation Problem) A $1,000 par value bond with a coupon interest rate of 12.8 percent per year paid semiannually matures in 25 years. Draw a CF diagram corresponding to this information and then complete the table below by filling in the prices and YTMS that correspond to the given YTM's and prices respectively. Show all the work for part D-both the PVA and PV calculations. Then check your answer using your calculator's TVM solver menu or function keys. PRICE YTM А. 0% B. $1.000 C. $917.19 D. 16%
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