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6. Nungesser Corporation has issued bonds that have a 9 percentcoupon rate, payable

semiannually. The bonds mature in 6 years, have a face value of$1,000, and a yield to maturity of 8.5 percent.

1). What is the price of the bonds?

$1,023.13

2). What is the current yield?

8.80%

3). What is the capital gains yield?

-0.30%

4). These bonds sell at

a. par b. a premium c. a discount

Premium. Please Show All Work.

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Jean Keeling
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28 Sep 2019

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Nungesser Corporation has issued bonds that have a 9 percentcoupon rate, payable semiannually. The bonds mature in 6 years,have a face value of $1,000, and a yield to maturity of 8.5percent. Current Market Price = PV(Rate,Nper,PMT,FV) 1). What isthe price of the bonds? $1,023.13 2). What is the current yield?8.80% 3). What is the capital gains yield? -0.30% 4). These bondssell at a. par b. a premium c. a discount

Please type out all responses as I am on mobile no grid style orexcel please

The 7 percent bonds issued by Modern Kitchens pay interestsemiannually, mature in eight years, and have a $1,000 face value.Currently, the yield to maturity for these bonds is 7.22%. What isthe market price per bond?

$986.81

S.S. Corporation’s bonds will mature in 15 years. The bonds havea face value of $1,000 and

an 6.5 percent coupon rate, paid semiannually. The price of thebonds is $1,050. What is the yield to maturity?

5.99%

Callaghan Motor’s bonds have 7 years remaining to maturity.Interest is paid annually, the

bonds have a $1,000 par value, and the coupon interest rate is5.5 percent. The bonds have a yield to maturity of 8 percent.

1). What is the current market price of these bonds?

$869.84

2). What is the current yield?

6.32%

3). What is the capital gains yield?

1.68%

4). These bonds sell at

a. par b. a premium c. a discount

Discount.

Nungesser Corporation has issued bonds that have a 9 percentcoupon rate, payable

semiannually. The bonds mature in 6 years, have a face value of$1,000, and a yield to maturity of 8.5 percent.

1). What is the price of the bonds?

$1,023.13

2). What is the current yield?

8.80%

3). What is the capital gains yield?

-0.30%

4). These bonds sell at

a. par b. a premium c. a discount

Premium.

Getty Markets has bonds outstanding that have a real return of3.08 percent. The current rate of inflation is 3.1 percent. What isthe nominal rate of return on these bonds?

6.28%

Suppose the nominal rate you see on a Treasury bill is 4.31percent and its real rate is 2.5 percent, what is the inflationrate?

1.77%

Problem set 2

Homework: 1, 3, 4, 6, 8, 9, 11, 12

Suppose you are thinking of purchasing the stock of Moore Oil,Inc. You expect the stock to pay a dividend of $0.75 per share atthe end of Year 1 and $1.75 per share at the end of Year 2. Youbelieve you can sell the stock for $15.50 at the end of Year 2.What is the value per share of the company’s stock if the requiredrate of return is 12 percent?

$14.42

Investors expect Microtech to pay the first dividend of $1.25 atthe end of Year 2. The dividend should grow at a rate of 8 percentper year during Years 3, 4, and 5. The stock can be sold for $42 atthe end of Year 5. Determine the current market value of thecompany’s stock if the required rate of return is 12 percent.

$27.61

Diets For You announced today that it will begin paying annualdividends next year.

The first dividend will be $1.25 a share. The followingdividends will be $0.25, $0.25,

$0.50, and $0.75 a share annually for the following 4 years,respectively. At the end of

the fifth year, the stock could be sold for $18. How much areyou willing to pay to buy

one share of this stock today if your desired rate of return is8.5 percent?

$14.39

Please Show all work and steps typed as I am onmobile

1.

The current dividend yield on Clayton's Metals common stock is3.2 percent. The company just paid a $1.48 annual dividend andannounced plans to pay $1.54 next year. The dividend growth rate isexpected to remain constant at the current level. What is therequired rate of return on this stock?

7.25 percent

7.82 percent

8.08 percent

8.75 percent

8.39 percent

2.

Which one of the following is computed by dividing next year'sannual dividend by the current stock price?

total yield

dividend yield

yield to maturity

growth rate

capital gains yield

3.

The bonds issued by Stainless Tubs bear an 8 percent coupon,payable semiannually. The bonds mature in 11 years and have a$1,000 face value. Currently, the bonds sell for $952. What is theyield to maturity?

7.92 percent

9.20 percent

8.69 percent

7.87 percent

8.08 percent

4.

Which one of the following applies to a premium bond?

Coupon rate > yield-to-maturity > current yield.
Coupon rate > current yield > yield to maturity.
Coupon rate < yield to maturity < current yield.

Yield to maturity > current yield > coupon rate.

Coupon rate = current yield = yield-to-maturity.

Please answer all the questions. Thank you.

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