{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

FI 311 Connect homework #6

# FI 311 Connect homework #6 - CONNECT 6 1 Oil Well Supply...

This preview shows pages 1–3. Sign up to view the full content.

CONNECT 6 1) Oil Well Supply offers a 7 percent coupon bond with semiannual payments and a yield to maturity of 7.73 percent. The bonds mature in 9 years. What is the market price per bond if the face value is \$1,000? \$1016.95 \$1401.26 \$953.28 \$953.88 \$1401.86 Enter 9 × 2 7.73/2 70/2 1,000 N I/Y PV PMT FV Solve for –953.28 2) A bond that pays interest annually yielded 7.75 percent last year. The inflation rate for the same period was 5.80 percent. What was the real return on this bond? Format to 4 decimal places. 5.88 percent 1.84 percent 5.80 percent 1.95 percent 2.01 percent 3) A zero coupon bond with a face value of \$1,000 is issued with an initial price of \$475.00. The bond matures in 25 years. What is the implicit interest, in dollars, for the first year of the bond's life? Assume semi-annual compounding and format to 6 decimal places. Your answer may be slightly different that the one shown if using the amortization worksheet.. \$30.57 \$12.28 \$9.00 \$21.00 \$14.36 Implicit interest = \$489.36 − \$475 = \$14.36 4) An indenture is: the legal agreement between the bond issuer and the bondholders. a bond that is secured by the inventory held by the bond's issuer. the written record of all the holders of a bond issue. another name for a bond's coupon.

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

View Full Document
a bond that is past its maturity date but has yet to be repaid.
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### Page1 / 5

FI 311 Connect homework #6 - CONNECT 6 1 Oil Well Supply...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online