The Green Cable Corporation issued a new series of bonds on January 5, 2015. The bonds were sold at par ($1,000), have a 6% coupon rate, and mature in 30 years on December 31, 2044. Coupon interest payments are made semiannually (on June 30 and December 31).
What was the yield to maturity (YTM) of the bond on January 5, 2015?
The Green Cable Corporation issued a new series of bonds on January 5, 2015. The bonds were sold at par ($1,000), have a 6% coupon rate, and mature in 30 years on December 31, 2044. Coupon interest payments are made semiannually (on June 30 and December 31).
Assuming that interest rates had fallen to 5%, what was the price of the bond on January 1, 2020 (five years later)?
The Green Cable Corporation issued a new series of bonds on January 5, 2015. The bonds were sold at par ($1,000), have a 6% coupon rate, and mature in 30 years on December 31, 2044. Coupon interest payments are made semiannually (on June 30 and December 31).
On July 1, 2017, the bonds sold for $922.38. What was the current yield at sale on that date?
You plan to buy a $250,000 home with a 20% down payment. The bank you want to finance the loan through suggests two options: a 15-year mortgage at 4.25% APR and a 30-year mortgage at 5% APR. What is the difference in monthly payments between these two options?
(A/P, 5%/ 12, 360) = 0.0053682 and (A/P, 5%/12, 180) = 0.0075228
On a $400,000 home mortgage loan with a 15-year term at 9% APR compounded monthly, compute the total combined payments on principal and interest over the first five years of ownership.
(A/P, 9%/12, 180) = 0.010143
On a $400,000 home mortgage loan with a 15-year term at 9% APR compounded monthly, what is the remaining balance at the end of 5 years.
(A/P, 9%/12, 180) = 0.010143, (P/A, 9%/12, 120) = 78.941692
Suppose you have the choice of investing in one of the following.
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Option 1: A zero-coupon bond which costs $513.60 today, pays nothing during its life, and then pays $1,000 after five years.
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Option 2: A bond that costs $1,000 today, pays $113 in interest semiannually and matures at the end of five years with a par value of $1,000 to be repaid.
Which bond would provide the higher yield?
