Problem 6.13 – Treasury Issue Grid
Essentials of Corporate Finance
Ross, Westerfield, and Jordan
10th Edition
Determine the coupon rate, bid price, and asked price for treasuries listed in figure 6.3.
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Determine the coupon rate, bid price, and asked price for treasuries listed in figure 6.3.
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Given the information on the treasury bond, in the month and year given… find out if it’s a premium or discount bond, the current yield, yield to maturity, and bid-ask spread.
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What are the prices and expected prices of two bonds, Bond X and Bond Y, given their coupon rates, YTM, maturity, and par value, and what is the explanation for the differences in their prices over time? Determine the price of bonds X and Y today, one year from now, three years from now… etc. Fill out the grid.
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Calculate the percentage change in the price for both bonds given a change in interest rates.
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What are the two alternative options for the company to raise money by issuing bonds, and what are the differences in terms of the number of bonds issued, years, and the firm’s aftertax cash outflows for the first year under each scenario? Determine the number of coupon bonds and zeros that are needed, the company repayments, and the cash flows.
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You are given a table of Treasury quotes with missing values and are asked to determine the asked price and the bid price.
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What is the yield to maturity of the bond issued by Xenon, Inc.? What is the price of the Kenny Corp. bond and its current yield? What is the coupon rate of the Williams Co. bond? Determine the missing values marked by ?? in the table for Xenon, Inc., Kenny Corp., and Williams Co. The numbers most likely to be asked are marked in bold. This solver solves 3 problems in a row.
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What is the current yield for Bond P and Bond D, which are premium and discount bonds with different coupon rates, and what is the expected capital gains yield over the next year for both bonds if interest rates remain unchanged? Solve for the current yield and capital gains yield for Bond P and Bond D.
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