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Ch 06 Bond Valuation Finished

Ch 06 Bond Valuation Finished - A 1 2 3 4 5 6 7 8 9 10 11...

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Annual Payments Inputs Number of Periods to Maturity (T) 8 Face Value (PAR) $1,000.00 Discount Rate / Period (r) 4.26% Coupon Payment (PMT) $45.00 Bond Price using a Timeline Period 0 1 2 3 4 5 6 7 8 Cash Flows $45.00 $45.00 $45.00 $45.00 $45.00 $45.00 $45.00 $1,045.00 Present Value of Cash Flow $43.16 $41.40 $39.71 $38.08 $36.53 $35.04 $33.60 $748.47 Bond Price $1,015.99 Bond Price using the Formula Bond Price (P) $1,015.99 Bond Price using the PV Function Bond Price $1,015.99 B OND V ALUATION ( 29 ( 29 ( 29 ( 29 1 1 1 T T PMT r PAR P r r - - + = + + A B C D E F G H I J 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29
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EAR and APR Annual Percentage Rate Inputs Rate Convention 2 Annual Coupon Rate 4.625% Yield to Maturity (Annualized) 3.94% Number of Payments / Year 2 Number of Periods to Maturity (T) 8 Face Value (PAR) $1,000.00 Outputs Discount Rate / Period (r) 1.97% Coupon Payment (PMT) $23.13 Bond Price using a Timeline Period 0 1 2 3 4 5 6 7 8 Time (Years) 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 Cash Flows $23.13 $23.13 $23.13 $23.13 $23.13 $23.13 $23.13 $1,023.13 Present Value of Cash Flow $22.68 $22.24 $21.81 $21.39 $20.98 $20.57 $20.17 $875.28 Bond Price $1,025.12 Bond Price using the Formula Bond Price $1,025.12 Bond Price using the PV Function Bond Price $1,025.12
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