Ch 3_Bond Valuation_Solution.xlsx - BOND PRICING Annual Coupons Inputs Today Maturity Date Number of Years to Maturity(T Face Value(PAR $ Coupon Rate

Ch 3_Bond Valuation_Solution.xlsx - BOND PRICING Annual...

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Annual CouponsInputsToday10/3/2018Maturity Date10/3/2022Number of Years to Maturity (T)4Face Value (PAR)$ 100.00 Coupon Rate5%Annual Coupon Payment$ 5.00 Coupon rate*ParRequired Annual Yield4.50%Bond Price using a TimelinePeriod01234$ 5.00 $ 5.00 $ 5.00 $ 105.00 Cash Flows$4.78 $4.58 $4.38 $88.05 Present Value of Cash Flows=C14/(1+$B$10)^C13Bond Price $101.79 $4.78 $4.58 $4.38 $88.05 =-PV($B$10,C13,0,C14)Bond Price using the NPV Function$101.79 Bond Price =NPV(B10,C14:F14)Bond Price using the FormulaBond Price (P)`Bond Price using the PV Function$101.79 Bond Price =-PV(B10,B6,B9,B7)Bond Price using the PRICE Function101.79Bond Price =PRICE(B4,B5,B8,B10,B7,1)BONDPRICING
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Semi-annual CouponsInputsToday10/3/2018Maturity Date10/3/2022Number of Years to Maturity (T)4Face Value (PAR)$ 100.00 Coupon Rate5%Annual Coupon Payment$ 5.00 Required Annual Yield4.50%Bond Price using a TimelinePeriod01234$ 2.50 $ 2.50 $ 2.50 $ 2.50 Cash Flows$2.44 $2.39 $2.34 $2.29 Present Value of Cash Flows=-PV($B$11/2,C14,0,C15)Bond Price $101.81 =SUM(C16:J16)Bond Price using the NPV Function
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