Finance Help

Finance Help

Bond Valuation and Yield
A bond has a par value of $1,000, pays $50 semiannually and has a maturity of 10 years.
If the bond earns 12% per year, what is the price of the bond?
Rate 12%
Nper 10
PMT
FV
Type
PV
What is the yield to maturity for the bond?
Nper
PMT
PV
FV
Type
Rate
What would be the bond’s price if the rate earned declined to 8% per year?
Rate
Nper
PMT
FV
Type
PV
If the maturity period is reduced to 5 years and the required rate of return is 8%, what would be the price of the bond?
Rate
Nper
PMT
FV
Type
PV
What is the yield to maturity for the bond when the maturity is 5 years and the required rate of return is 8%?
Nper
PMT
PV
FV
Type
Rate
What generalizations about bond prices, interest rates and maturity periods can be made based on the calculations made above?