please show work for EACH PROBLEM for business calculator. ex. rate, N, PMT,PV,F
ID: 2785407 • Letter: P
Question
please show work for EACH PROBLEM for business calculator. ex. rate, N, PMT,PV,FV
5 The priee on a zero coupon bond that matures in 1 year is $967.20. What is the yied to maturity (TM) of the bond? Assume $1000 face amount Show answer to nearest hundredth of 1 percent. Ex. 6.48% 6 You bought a Beta Tapeplayer Ine bond two days ago It was rated AA by Stadard and Por's and was selling at a yield to maturity (YTM) of 6.10%. Today it was downgraded to an A rating and the YTM mere axed la 6.70%. The bond has coupon rate of 5.70%, and has 13 years to maturity. Assume annual coupons and a 51000 face amount. What was your purchase price? What is it worth today? What has been your percentage loss in value? Note: Ignore the 2 days- treat it as if the bond rating droppedExplanation / Answer
5) N = 1, PMT = 0, PV = -967.2, FV = 1000 => Compute I/Y = 3.39%
6) N = 13, PMT = 5.7% x 1000 = 57, FV = 1000, I/Y = 6.10% => Compute PV = $964.80 is the purchase price
Price today, I/Y = 6.7% with other parameters as they were => Compute PV = $914.98 is the price today
=> % Change = 914.98 / 964.80 - 1 = -5.16%
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