problem 1: Moussawi Ltd's outstanding bonds encompass a $1,000 par value, and they mature in 5 years. Their yield to maturity is 9%, based upon semiannual compounding and the present market price is $853.61. Determine the bond's annual coupon interest rate?
a) 5.10%
b) 5.20%
c) 5.30%
d) 5.40%
e) 5.50%
problem 2: Walker Industries has a bond outstanding with 12-years to maturity, a 9% coupon paid semi-annually and a $1,000 par value. The bond has a 7% nominal yield to maturity; however it can be called in 3-years at a price of $1,045. Determine the bond's nominal yield to call?
a) 4.43%
b) 4.62%
c) 4.82%
d) 4.91%
e) 4.99%
problem 3: You just purchased a $1,000 par value, 9-year, and 7% semiannual coupon bond. The bond sells for $920. Determine the nominal yield to maturity?
a) 7.28%
b) 8.28%
c) 9.60%
d) 8.67%
e) 4.13%
problem 4: A 10-year, $1,000 face value bond sells for $1,075. The bond consists of a 9% semi-annual coupon and is callable in 5-years and a call price is $1,035. Determine the bond's nominal yield to call?
a) 7.19%
b) 7.75%
c) 7.90%
d) 8.00%
e) 8.13%
problem 5: T. Martell Inc.'s stock consists of a 50% chance of producing a 30% return, a 25% chance of producing a 9% return and a 25% chance of producing a -25% return. Determine the Martell's expected return?
a) 14.4%
b) 15.2%
c) 16.0%
d) 16.8%
e) 17.6%