What is the discount yleld, bond equivalent yield, and effective annual retum on a $1 million T-bill that currently sells at 99.375 percentof ts lace value and is 65 days from maturity? (Use 360 deys for discount yield and 365 days in a yenr for bond equivalent yield andeffective annunl return. De not round intermedinte calculetions. Round your answers to 3 decimal places. (e.g., 32.161)Dscount ykdElond equivalont yldEfictive annual retum

There are different ways of presenting the return on a bond, for example, discount yield, bond…

Answered: What is the discount yleld, bond…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Determine the price of a single bond given the following information. Round your final answer to two decimal places. For example, if your answer is $89.12, enter 89.12 with no currency symbol. 4.39% Cost of Debt (Kd) The company is expected to pay the following forecasted CFFD (Cash Flows For Debt): Year 1: $50.00 interest payment Year 2: $50.00 interest payment Year 3: $50.00 interest payment Year 4: $50.00 interest payment Year 5: $50.00 interest payment The company will also pay the bond's face value of $1,000.00 at the end of year 5. The company faces a 25% tax rate. Type your answer...
What is the discount yield, bond equivalent yield, and effective annual return on a $1 million T-bill that currently sells at 95.375 percent of its face value and is 60 days from maturity? (Use 360 days for discount yield and 365 days in a year for bond equivalent yield and effective annual return. Do not round intermediate calculations. Round your answers to 3 decimal places. (e.g., 32.161)) Discount yield Bond equivalent yield Effective annual return
Using the formula given below: Rbonds = F - P P if the market price of a $1,000-face-value discount bond changes from $925 to $900, the yield to maturity increases by%. (Round your response to two decimal places.)
Give typing answer with explanation and conclusion The price of a newly issued 3-month T-bill with a face value of $1,000 is $992. A) What is the bond-equivalent yield? B) What is the discount yield?
What is the discount yield, bond equivalent yield, and effective annual return on a $1 million Treasury bill that currently sells at 93.375 percent of its face value and is 70 days from maturity? (Use 360 days for discount yield and 365 days in a year for bond equivalent yield and effective annual return. Do not round intermediate calculations. Round your percentage answers to 3 decimal places. (e.g., 32.161)) Discount yield Bond equivalent yield Effective annual return % % %
What is the discount yield, bond equivalent yield, and effective annual return on a $3 million commercial paper issue that currently sells at 97.50 percent of its face value and is 145 days from maturity? (Use 360 days for discount yield and 365 days in a year for bond equivalent yield and effective annual return. Do not round intermediate calculations. Round your answers to 3 decimal places. (e.g., 32.161)) Discount yield Bond equivalent yield Effective annual return ২| ২
What is the discount yield, bond equivalent yield, and effective annual return on a $2 million commercial paper issue that currently sells at 97.50 percent of its face value and is 123 days from maturity? (Use 360 days for discount yield and 365 days in a year for bond equivalent yield and effective annual return. Do not round intermediate calculations. Round your percentage answers to 3 decimal places. (e.g., 32.161)) Discount yield Bond equivalent yield Effective annual return % % %
Using the formula given below: Rbonds =( F − P)/P, if the market price of a $1,200-face-value discount bond changes from $900 to $925, the yield to maturity decreases or increases by enter your response here%. (Round your response to two decimal places.)
Suppose the current interest rate on a one-year bond is 2% and the current interest rate on a two-year bond is 4%. The term premium on a two-year bond is 1%. According to the expectations hypothesis, what interest rate should we expect on a one-year bond next year? Answer as a percentage to one decimal place and do not include symbols (e.g. $, %, commas) in your answer. Answer:
The current yield on a 1 year treasury bond is. 91% and the current yield on a 2 year treasury bond is 1.36\%. What is the expected yield on a 1 year treasury bond, 1 year from today (forward rate)? Use 100 par value in your calculation. Enter your answer in decimal format (0123), not percentage format (1.23\%). Round to 4 decimal places.
Question 3: Answer the following Two questions: (CLO-3) I. You would like to purchase a Treasury bill that has a $10,000 face value and is 68 days from maturity. The current price of the Treasury bill is $9,875. Caleulate the discount yield on this Treasury bill. Answer 2. a) What are the differences among T-bills, T-Note, and T-bonds? Answer:
Using the following information, determine the default risk premium on the 10 year AA corporate bond: Rate % inflation 0.80 T-bill 5.00 10y T-Bond 6.00 10y AAA Corporate 6.48 10y AA Corporate 7.03 note: your answer should be to 2 decimal places. So, if your answer is 3.253%, for example, then enter 3.25 without the percent sign.

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