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1) Life Science, Inc. has a $1,000 par value bonds outstanding at coupon of 10 percent interest. The bonds will mature in 15 years. Compute the current price of the bonds if the present yield to maturity is:

a. 8%

b. 6%

c. 13%

2) The Road Repair Incorporated company has a $1,000 par value bond outstanding that pays 8% annual interest. The current yield to maturity is 10%. Compute the price of the bonds for these maturity dates:

20 years

15 years

5 years

4) Headfirst Risk Takers, Inc. bonds mature in four years. The coupon rate is 5% and interest is paid annually. The bonds have a $1,000 par value. If the bonds’ price is currently $841.51, what is the yield to maturity?

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92878459

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