1. Red Cedar Corporation has issued a bond with the following characteristics:

Par: $1,000

Time to maturity: 25 years

Coupon rate: 7%

Semiannual payments

Calculate the price of this bond if the YTM is:

a. 7%

b. 9%

c. 5%

2. Hollin Corporation has bonds on the market with 12.5 years to maturity, a YTM of 7.3 percent, and a current price of $1,040. The bonds make semiannual payments. What must the coupon rate on these bonds?

3. What is the price of a zero coupon bond with 20 years to maturity paying $1,000 at maturity if the YTM is:

a. 5 %

b. 10%

c. 15%

4. Watters Umbrella Corp. issued 15 year bonds two years ago at a coupon rate of 6.8 percent. The bonds make semiannual payments. If these bonds currently sell for 105 percent of par value, what is the YTM?

5. You purchase a bond with a coupon rate of 8.2 percent and a clean price of $1,060. If the next semiannual coupon payment is due in four months, what is the invoice price?