BOND PRACTICE PROBLEMS - BOND PRACTICE PROBLEMS 1....

Info iconThis preview shows pages 1–5. Sign up to view the full content.

View Full Document Right Arrow Icon
BOND PRACTICE PROBLEMS 1. Calculate the current yield on the following bond: Par Value = $1,400; Current Value = $680; coupon interest rate = 7.5%. 2. Calculate the current yield on the following bond: Par Value = $3,500; current value = $1,350; coupon interest rate = 9.5% 3. Calculate the current yield on the following bond: Par Value = $2,500; current value = $350; coupon interest rate = 7.0% 4. Calculate the current yield on the following bond: Par Value = $1,700; current value = $1,450; coupon interest rate = 4.5% 5. Calculate the yield to maturity of the following bond: Par value = $2,300; current value = $650; the bond matures in 15 years; coupon interest rate = 6%.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
6. Calculate the yield to maturity of the following bond: Par value = $4,300; current value = $1,350; the bond matures in 10 years; coupon interest rate = 8.2%. 7. Calculate the yield to maturity of the following bond: Par value = $1,800; current value = $950; the bond matures in 8 years; coupon interest rate = 9.7%. 8. Calculate the yield to maturity of the following bond: Par value = $8,300; current value = $2650; the bond matures in 12 years; coupon interest rate = 5.3%.
Background image of page 2
EXAM 3 INVESTING PRACTICE PROBLEMS Question 1 If you want to have $2.3 million dollars ($2,300,000) in your investment account in 30 years and you can earn an annual rate of return on your investments of 9.5%, how much do you need to invest annually to have $2.3 million dollars in 30 years? Question 2 Calculate the rate of return on a share of stock, if the stock rose from $120 per share to $285 per share over 1 year, while paying $100 in dividends during the year. Question 3 If you want to have $5.5 million dollars $5,500,000 in your investment account in 30 years and you can get an annual rate of return of 12%, how much do you need to invest each year, beginning today, to have $5.5 million in your investment account in the future? Question 4 Calculate the annualized rate of return on a share of stock purchased for $52 and sold for $109 after 13 years. Dividends paid during each year were $3 per share. Question 5
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Calculate the rate of return on a share of stock purchased in 2004 for $25, and sold in 2006 for $45. During the year the stock paid $40 in dividends. Question 6 If you can invest $13,500 each year in an investment portfolio that generates an annual rate of return of 10.7%, how much will you have in your account at the end of 25 years? Q uestion 7 Tyler and Jasmine are taking out life insurance on Jasmine. They have 1 small child. Jasmine earns $85,000 per year. They believe they need this coverage for the next 18 years. How much life insurance should they take out on Jasmine? Tyler believes he can get a rate of return of 8.75% on the life insurance settlement. Question 8
Background image of page 4
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 12

BOND PRACTICE PROBLEMS - BOND PRACTICE PROBLEMS 1....

This preview shows document pages 1 - 5. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online