1. A bond maturing in 20 years at a par value of $1,000 has a coupon rate of 6% and current yield of 8%. Is this a discount bond or a premium bond? What is the price of the bond?
2. A bond maturing in 15 years at a par value of $1,000 has a coupon rate of 4% and current yield of 3%. Is this a discount bond or a premium bond? What is the price of the bond?
3. A bond maturing in 10 years at a par value of $1,000 has a coupon rate of 9% and current market price of $1,145.68. What is the bond’s annual yield?
4. A bond maturing in 15 years at a par value of $1,000 has a coupon rate of 5%. If the current interest rate is 4%, what is the price of the bond?
5. A bond maturing in 15 years at a par value of $1,000 has a coupon rate of 7% and current market price of $1,140.95. If the bond is callable after 5 years at $1,050, what is the bond’s yield to call? (Hint: Click on YTC tab in the Bond Calculator app).