An investor just purchased a 10-year, $1,000 par value bond. The coupon rate on this bond is 5 percent with interest being paid semiannually. If the investor expects to earn an 8 percent rate of return on this Dond, how much should she pay for it?
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- A bond promises to pay you $7,000.00 in 10 years. If you are able to earn 6 percent on securities of equal risks, what would be the present value of the Bond? (to the nearest dollar) Select one: a. $3,589 b. $3,909 c. $3,727.00 d. $4,200a. Assuming you purchased the bond for $350 what rate of return would you earn if you held the bond for 25 years until it matured with a value $1000? a. Rate of return____% b. Suppose under the terms of thebond you could redeem the bond in 2024. DMF agreed to pay an annual interest rate of 1.4 percent until the date. How much would the bond be worth at that time? b. Bond value_____ c. In 2024 instead of cashing in the bond for its then current value you decide to hold the bond until it mature in 2043. What annual rate of return will you earn over the last 19 years? c. Rate of return___%A bond promises to pay you $7,000.00 in 10 years. If you are able to earn 6 percent on securities of equal risks, what would be the present value of the Bond? (to the nearest dollar) Select one: a. $3,727.00 b. $4,200 c. $3,909 d. $3,589 Clear my choice
- You're considering an investment in 10-year, $1,000 face value bonds that pay 8.50% annually and sell for $1,033.55. If you do make the purchase, how much will you earn? Select one: O a. 8.00% O b. 8.50% Oc. 7.59% Od 8.25% Oe. 8.86% Clear my choice AYou have just purchased a 15-year, P1,000 par value bond. The coupon rate on this bond is nine percent (9%) annually, with interest being paid each six months. If you expect to earn a 12 percent market rate of return on this bond, how much did you pay for it? a. P793.53 b. P950.75 c. P875.38 d. P642.76a) What is the value of a 10 year, 8.2% coupon bond with semiannual coupons.Assume the par value of the bond is $100 and it is redeemable at par. The interest rate (nominal, converted semiannually) is 10.6%. b) An investor purchased a bond that pays $5 coupons annually at the end of everyyear for five years. The purchase price was $100 and it was redeemed at par after fiveyears. If the annual effective inflation rate over the time period was 3%, calculate the realrate of return earned by the investor on this bond.
- An investor holds a Ford bond with a face value of $5000, a coupon rate of 7.5%, and semiannual payments that matures on 01/15/2029. How much will the investor receive on 01/15/20292 A. $5.000.00 OB. $2.503.75 OC. $5,375.00 OD. $5,187.50You have just purchased a 10-year, $1,000 par value bond. The coupon rate on this bond is 6%, with interest being paid quarterly. If you expect a 5% rate of return on this bond, how much did you pay for it? O $1,077.32 O $2,153.69 O $1,078.32 O $2,488.03(Bond valuation) You own a 10-year, $1,000 par value bond paying 8 percent interest annually. The market price of the bond is $825, and your required rate of return is 12 percent. a. Compute the bond's expected rate of return. b. Determine the value of the bond to you, given your required rate of return. c. Should you sell the bond or continue to own it? ... a. What is the expected rate of return of the 10-year, $1,000 par value bond paying 8 percent interest annually if its market price is $825? % (Round to two decimal places.)
- Which will you prefer to invest your $1,50O: a) a two year bond with interest rate of 9 percent or b) two one year bonds, Year 1, the bond will earn 8% and year 2 the second bond will earn 9%. Which bond will you buy?To secure a return of 4%, at what price should a bond be purchased if it is redeemable at P 1,000 in 10 years and plays annual dividends of P 35,00? Ans. P 959.45 You purchased a P 500 bond for P 5,100.00. The bond pays 200 per year. It is redeemable for P 5,050 after 10 years. What is the net rate of interest on your investment? Ans. 3.486%4. You buy a 4% 10-year $1,000 face value bond for $1,148.14. A year later, you sell the bond for $1,200. What is your rate of return on the bond for the year?