1. Blue Crab, Inc. plans to issue new bonds, but is uncertain how the market would set the yield to maturity. The bonds would be 26-year to maturity, carry a 11.54 percent annual coupon, and have a $1,000 par value. Blue Crab, Inc. has determined that these bonds would sell for $1,357 each. What is the yield to maturity for these bonds?
Round the answers to two decimal places in percentage form. (Write the percentage sign in the "units" box).
You should use Excel or financial calculator.
2. 17 years ago, Mini Max Inc. issued 30 year to maturity zero-coupon bonds with a par value of $1,000. Now the bond has a yield to maturity of 7.57 percent, compounded semi-annually. What is the current price of the bond?
Round the answer to two decimal places.
3. What is the yield to call of a 30-year to maturity bond that pays a coupon rate of 11.98 percent per year, has a $1,000 par value, and is currently priced at $918? The bond can be called back in 7 years at a call price $1,089. Assume annual coupon payments.
Round the answer to two decimal places in percentage form. (Write the percentage sign in the "units" box)
You should use Excel or financial calculator.