You are offered a perpetuity of 400 a year with the first


1. A 11?year bond pays interest of $27.60 ?semiannually, has a face value of $1,000?, and is selling for $792.28. What are its annual coupon rate and yield to? maturity?

2. What is the price of a 33?-year, 8.3% coupon? rate, $1,000 face value bond that pays interest quarterly if the yield to maturity on similar bonds is 11.5%??

3. You are offered a perpetuity of $400 a year with the first payment to be made in 3 years. If the annual interest rate is 5%, what is the present value?

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Financial Management: You are offered a perpetuity of 400 a year with the first
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