"Bond" Essays and Research Papers

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  • Bonds: Bond and Yield

    What are Yield to Maturity (YTM) and Yield to Call (YTC)? By calculating the present and future value of bonds‚ managers can make sound decisions about their potential strengths and weaknesses as investments. Answer the following questions in this week’s Discussion 2 thread: 1. What terms (or inputs) are needed to calculate yield to maturity (YTM)? How does this compare to calculating yield to call (YTC)? To calculate the YTM you will need to use Annual Interest‚ Par value‚ Market Price

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  • Bonds

    Bonds and Their Valuation After reading this chapter‚ students should be able to: • List the four main classifications of bonds and differentiate among them. • Identify the key characteristics common to all bonds. • Calculate the value of a bond with annual or semiannual interest payments. • Explain why the market value of an outstanding fixed-rate bond will fall when interest rates rise on new bonds of equal risk‚ or vice versa. • Calculate the current yield

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  • Bonds

    perpetual bond is currently selling for RS. 95/-. The coupon rate of interest is 13.5%. The approximate discount rate is 15%. The value of the bond and the YTM is: (a) Rs. 90/- and 14.2% Value is (13.5*15%=90) and YTM is ((13.5/95)*100=14.21%) (b) Rs. 100/- and 13.5% (c) Rs. 90 and 15% (d) Rs. 90/- and 13.5% 902. In 2001‚ Meridian Ltd. has issued bonds of Rs. 10‚000/-each due in 2011 with a 14% per annum coupon rate payable at the end of each year during the life of the bond. If the required

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  • Bond and Bonds Payable

    90‚000 Share of dividends (.25 × $160‚000) (40‚000) Balance in investment account $550‚000 2)During 2008‚ PK Co. purchased 2‚000‚ $1‚000‚ 9% bonds. The carrying value of the bonds at December 31‚ 2010 was $1‚960‚000. The bonds mature on March 1‚ 2015‚ and pay interest on March 1 and September 1. PK sells 1‚000 bonds on September 1‚ 2012‚ for $988‚000‚ after the interest has been received. PK uses straight-line amortization. The gain on the sale is Discount amortization: $40

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  • Bonds

    BOND PROBLEM SOLUTIONS 1. Six years ago‚ The Corzine Company sold a 20-year bond issue with a 14 percent annual coupon rate and a 9 percent call premium. Today‚ Corzine called the bonds. The bonds originally were sold at their face value of $1‚000. Compute the realized rate of return for investors who purchased the bonds when they were issued and who surrender them today in exchange for the call price. PV = 1000; N = 6; PMT = 140; FV = 1090; CPT I/Y I/Y = 15.02% 2. You just purchased

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  • Bonds

    Using present value to value bonds A bond‚ from the perspective of the person issuing the bond is a form of long term debt. In the hands of the person who has acquired the bond it is an asset. The agency issuing the bond agrees to pay a fixed sum of money to the holder of the bond for a period of years and then‚ at the end of that period‚ to pay back the face value of the bond. Bonds can be issued by a variety of agencies/companies: 1. Municipal bonds: issued by cities‚ states and

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  • Bonds

    CONTENTS Introduction of bonds……………………………………………..01 Characteristics of Bonds…………………………………………01 Types of Bonds…………………………………………………… 06 Bonds Market……………………………………………………… 08 Introduction of Pakistan bond market……………...................08 How Bonds Trade……………………………………………….….09 Bond Price Variations……………………………………………..09 Bond valuation…………………………………………..................09 Types of bonds trade in Pakistan……………………………….10 Government Debt Securities……………………………………..10 Characteristics of MTBs and PIBs………………………………12

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  • Bonds

    INTRODUCTION - The Swan Davis Corporation case focuses on following issues: • The importance in bond and stock valuation; • The capital structure of the company; and • How they effects to the capital budgeting decisions of the company. - Swan- Davis Inc.‚ (SDI) manufactures equipment for sale to large contractors‚ the company was found in 1976 and it went to the public in 1980 at its shares value risen from $1 to $15 since it enter to the market. - The financial statements for the past three

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  • Bonds: Bond and Cash Flow

    BONDS Bonds pay fixed coupon (interest) payments at fixed intervals (usually every six months) and pay the par value at maturity. Par value = $1‚000 Coupon = 6.5% or par value per year‚ or $65 per year ($32.50 every six months). Maturity = 28 years (matures in 2032). Issued by AT&T. Types of Bonds Debentures - unsecured bonds. Subordinated debentures - unsecured “junior” debt. Mortgage bonds - secured bonds. Zeros - bonds that pay only par value at maturity; no coupons. Junk bonds - speculative or

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  • Finance: Bonds

    of the following events would make it more likely that a company would choose to call its outstanding callable bonds? a. The company’s bonds are downgraded. b. Market interest rates rise sharply. c. Market interest rates decline sharply. d. The company ’s financial situation deteriorates significantly. e. Inflation increases significantly. . A 10-year bond with a 9% annual coupon has a yield to maturity of 8%. Which of the following statements is CORRECT?

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