YTM and YTC--semiannual bond Answer: e Diff: E
75. A corporate bond matures in 14 years. The bond has an 8 percent semiannual coupon and a par value of $1,000. The bond is callable in five years at a call price of $1,050. The price of the bond today is $1,075. What are the bond’s yield to maturity and yield to call?
a. YTM = 14.29%; YTC = 14.09%
b. YTM = 3.57%; YTC = 3.52%
c. YTM = 7.14%; YTC = 7.34%
d. YTM = 6.64%; YTC = 4.78%
e. YTM = 7.14%; YTC = 7.05%
Yield to maturity and bond value--annual bond Answer: d Diff: E
76. A 20-year bond with a par value of $1,000 has a 9 percent annual coupon. The bond currently sells for $925. If the bond’s yield to maturity remains at its current rate, what will be the price of the bond 5 years from now?
a. $ 966.79
b. $ 831.35
c. $1,090.00
d. $ 933.09
e. $ 925.00
Current yield Answer: b Diff: E
77. Consider a $1,000 par value bond with a 7 percent annual coupon. The bond pays interest annually. There are 9 years remaining until maturity. What is the current yield on the bond assuming that the required return on the bond is 10 percent?
a. 10.00%
b. 8.46%
c. 7.00%
d. 8.52%
e. 8.37%
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