Assume that the current yield to maturity on the bond

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-Compute the price of a $5,000 par value bond with a coupon rate of 7.75% (semi-annual payments) and 20 years remaining to maturity. Assume that the current yield to maturity on the bond is 8.60%.

-Compute the yield to maturity of a $2,500 par value bond with a coupon rate of 7.95% (quarterly payments – that is, four times per year) that matures in 25 years. The bond is currently selling for $3,265.

-What is the yield to maturity of a $1,000 par value bond with a coupon rate of 9.5% (monthly coupon payments) that matures in 28 years assuming the bond is currently selling for $838.13?

-Two years ago, Phutki Corp. issued a $1,000 par value, 11 percent (annual payment) coupon bond. At the time the bond was issued it had 15 years to maturity. Currently this bond is selling for $1,000 in the bond market. Phutki Corp. is now planning to issue a $1,000 par value bond with a coupon rate of 9 percent (semi-annual payments) that will mature 30 years from today. Assuming that the riskiness of the new bond is the same as the previous bond (i.e., the YTM on the new bond is equal to the current YTM on the previous bond), how much will investor's pay for this new bond?

Reference no: EM131338049

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