# Calculating the present value of a bond, business and finance homework help

. 4. (calculating the
present value of a bond)  If a corporate
bond with a face value of \$1,000 has 24 years to go until it matures, has a
coupon interest rate of 5.7% and a yield to maturity (YTM) of 4.201%, what
should be its price in the bond market (ie, PV)?

5. (calculating the
current yield of a bond)  If a corporate
bond with a face value of \$1,000 has 24 years to go until it matures, has a
coupon interest rate of 5.7% and a market price of \$1,223.92, what is its
current yield?

6. (calculating the YTM
of a bond)  If a corporate bond with a
face value of \$1,000 has 24 years to go until it matures, has a coupon interest
rate of 5.7% and a market price of \$1,223.92, what is its yield to maturity
(YTM)?

7. (calculating the YTC
of a bond)  Assume a callable corporate
bond with a face value of \$1,000, a coupon interest rate of 5.7%, a market
price of \$1,223.92, and a call premium of 6%. Assume also that the bond has 24
years to go until it matures, but it is callable after 14 years. What is the
bond’s yield to call (YTC)?

8. (calculating the
present value of a bond with semi-annual coupon interest payments)  If a corporate bond with a face value of
\$1,000 has 24 years to go until it matures, has a coupon interest rate of 5.7%,
paid semiannually, and has a yield to maturity (YTM) of 4.2%, what
should be its price in the bond market (ie, PV)?

9. (calculating the YTM
of a bond with semiannual interest payments)
If a corporate bond with a face value of \$1,000 has 24 years to go until
it matures, has a coupon interest rate of 5.7%, paid semiannually, and has a
market price of \$1,223.92, what is its yield to maturity (YTM)?

11. Assume the real
risk-free rate is 1%. Assume also that inflation is expected to be 1% in the
coming year (year 1), 2% in the next year after that (year 2), and 3% in the
year after that (year 3).  Assume also
that the default risk premium, the liquidity premium, and the maturity risk
premium are 0%.  Given these conditions,
what would be the yield on three-year treasury bonds today?

12. Suppose the First
Bank of St Louis was offering the following rates on certificates of deposit
(CDs) this week: