Exam 14: Bond Prices and Yields

A Treasury bond due in one year has a yield of 4.6%; a Treasury bond due in five years has a yield of 5.6%. A bond issued by Lucent Technologies due in five years has a yield of 8.9%; a bond issued by Exxon due in one year has a yield of 6.2%. The default risk premiums on the bonds issued by Exxon and Lucent Technologies, respectively, are

A ___________ bond is a bond where the bondholder has the right to cash in the bond before maturity at a specified price after a specific date.

A Treasury bond due in one year has a yield of 6.2%; a Treasury bond due in five years has a yield of 6.7%. A bond issued by Xerox due in five years has a yield of 7.9%; a bond issued by Exxon due in one year has a yield of 7.2%. The default risk premiums on the bonds issued by Exxon and Xerox, respectively, are

Consider the following $1,000-par-value zero-coupon bonds: Bond Years of Price Maturity A 1 \ 909.09 B 2 811.62 C 3 711.78 D 4 635.52 The yield to maturity on bond B is

TIPS are

A CDS is a

When a bond indenture includes a sinking fund provision,

You purchased an annual-interest coupon bond one year ago with six years remaining to maturity at the time of purchase. The coupon interest rate is 10%, and par value is $1,000. At the time you purchased the bond, the yield to maturity was 8%. If you sold the bond after receiving the first interest payment and the bond's yield to maturity had changed to 7%, your annual total rate of return on holding the bond for that year would have been

Collateralized bonds

If a 7.5% coupon bond is trading for $1,050.00, it has a current yield of

A coupon bond that pays interest of $40 semi-annually has a par value of $1,000, matures in four years, and is selling today at a $36 discount from par value. The yield to maturity on this bond is

A coupon bond is a bond that

If a 7.5% coupon bond that pays interest every 182 days paid interest 62 days ago, the accrued interest would be

An 8% coupon U.S. Treasury note pays interest on May 31 and November 30 and is traded for settlement on August 15. The accrued interest on the $100,000 face value of this note is

A coupon bond that pays interest annually has a par value of $1,000, matures in eight years, and has a yield to maturity of 9%. The intrinsic value of the bond today will be ______ if the coupon rate is 6%.

A coupon bond pays annual interest, has a par value of $1,000, matures in four years, has a coupon rate of 10%, and has a yield to maturity of 12%. The current yield on this bond is

The yield to maturity on a bond is

Swingin' Soiree, Inc. is a firm that has its main office on the Right Bank in Paris. The firm just issued bonds with a final payment amount that depends on whether the Seine River floods. This type of bond is known as

Of the following five investments, ________ is (are) considered the least risky.

A firm with a low rating from the bond-rating agencies would have