Herry is planning to purchase a Treasury bondwith a coupon rate of 2.63% and face value of $100. The maturity date of the bond is 15 March2033. (c) If Henry purchased this bond on 6March 2020, what is his purchase price (roundedto four decimal places)? Assume a yield rate of3.1% p. a. compounded half-yearly. Henry needs.to pay 27.6% on coupon payment and capital gainas tax payment. Assume that all tax paymentsare paid immediately. Question 3 a. 96.2164 b84.3188 c. 85.4859 d. 69.6809

To solve this problem, we need to calculate the present value of the bond using the given…

Answered: Herry is planning to purchase a…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Herry is planning to purchase a Treasury bond with a coupon rate of 2.63% and face value of $100. The maturity date of the bond is 15 March 2033. (d) If Henry purchased this bond on 6 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.1% p.a. compounded half-yearly. Henry needs to pay 27.6% on coupon payment and capital gain as tax payment. Assume that all tax payments are delayed by half year. O a. 85.6867 Ob. 70.0863 Oc. 84.5168 O d. 96.2170
Karl is planning to purchase a Treasury bond paying a (2) coupon rate of 3.86% p.a. The face value of the bond is $100. Its maturity date is 15 March 2033; the bond matures at par. If Karl purchased this bond on 4 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 4.24% p.a., compounded half-yearly. Karl needs to pay 19.7% of coupon payments and capital gains in tax. Assume that all tax payments are delayed by a half- year. a. $89.0716 b. $87.3203 c. $79.1253 d. $98.0081
Loïc is planning to purchase a Treasury bond paying a (j2) coupon rate of 2.57% p.a. The face value of the bond is $100. Its maturity date is 15 March 2033; the bond matures at par. If Loïc purchased this bond on 5 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 12.41% p.a., compounded half-yearly. Loïc needs to pay 32.3% of coupon payments and capital gains in tax. Assume that all tax payments are delayed by a half- year. O a. $28.5602 O b. $38.3864 O c. $27.6087 O d. $26.7505
Loïc is planning to purchase a Treasury bond paying a (₂) coupon rate of 5.93% p.a. The face value of the bond is $100. Its maturity date is 15 March 2033; the bond matures at par. If Loïc purchased this bond on 5 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 8.5% p.a., compounded half-yearly. Loïc needs to pay 28.3% of coupon payments and capital gains in tax. Assume that all tax payments are delayed by a half-year. O a. $64.0343 O b. $82.7153 O c. $66.4072 O d. $60.3125
Francis is planning to purchase an Australian Treasury bond with a coupon rate (j2) of 1.96% and face value of $100. The maturity date of the bond is 15 May 2033. If Francis purchased this bond on 7 May 2018, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 2.88% p.a. compounded half-yearly. Francis needs to pay 27.3% on coupon payment and capital gain as tax payment. Assume that all tax payments are paid immediately. a. 65.2711 b. 79.3732 c. 78.5074 d. 89.7601
Chloe is planning to purchase a Treasury bond paying a (j2) coupon rate of 4.05% p.a. The face value of the bond is $100. Its maturity date is 15 March 2033; the bond matures at par. If Chloe purchased this bond on 6 March 2020, what is her purchase price (rounded to four decimal places)? Assume a yield rate of 3.74% p.a., compounded half-yearly. Chloe needs to pay 26% of coupon payments and capital gains in tax. Assume that all tax payments are delayed by a half-year. a. $91.1196 b. $78.2736 c. $92.9081 d. $105.0643.
Siggi is planning to purchase an Australian Treasury bond with a coupon rate (j2) of 2.22% p.a. and face value of $100. The maturity date of the bond is 15 May 2033. If Siggi purchased this bond on 4 May 2018, what is her purchase price (rounded to four decimal places)? Assume a yield rate of 1.84% p.a. compounded half-yearly. Siggi needs to pay 28.3% of coupon payments and capital gains in tax payments. Assume that all tax payments are paid immediately. Question 11Answer a. $105.9890 b. $95.8030 c. $76.0108 d. $96.8161
mark is planning to purchase an Australian Treasury bond with a coupon rate (j2) of 1.04% and face value of $100. The maturity date of the bond is 15 May 2033. Markbond matures at par. If Markpurchased this bond on 2 May 2018, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.26% p.a. compounded half-yearly, allowing for taxation. Mark needs to pay tax at rate 21.7% on coupon payments. Assume the tax on coupon is paid immediately on the coupon payment date. а. $71.4907 b. $71.4921 С. $72.2427 d. $71.0840
Jay purchased a Treasury bond with a coupon rate of 4.49% and face value of $100. The maturity date of the bond is 15 March 2029. (b) In fact, Yuri changes his plan and Jay plans to sell this bond on 7 January 2022. What was Jay's sale price (rounded to four decimal places)? Assume a yield of 3.02% p.a. compounded half - yearly. Question Answer a. 111.6359 b 110.8412 c. 109.1924 d .108.7396
Giovanni is planning to purchase an Australian Treasury bond with a coupon rate (₂) of 4.76% and face value of $100. The maturity date of the bond is 15 May 2033. Giovanni's bond matures at par. If Giovanni purchased this bond on 5 May 2018, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 1.64% p.a. compounded half- yearly, allowing for taxation. Giovanni needs to pay tax at rate 23.1% on coupon payments. Assume the tax on coupon is paid immediately on the coupon payment date. O a. $128.5431 O b. $128.5422 O c. $126.7128 O d. $127.7518
Jay purchased a Treasury bond with a coupon rate of 3.72% and face value of $100. The maturity date of the bond is 15 March 2029. (b) In fact, Yuri changes his plan and Jay plans to sell this bond on 5 January 2022. What was Jay's sale price (rounded to four decimal places)? Assume a yield of 4.43% p. a. compounded half-yearly. Question 6Answer a. 94.9701 b. 94.7167 c. 96.8146 d. 96.5612
Giuseppe is planning to purchase an Australian Treasury bond with a coupon rate (j2) of 2.68% and face value of $100. The maturity date of the bond is 15 May 2033. If Giuseppe purchased this bond on 2 May 2018, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 1.94% p.a. compounded half-yearly, allowing for taxation. Giuseppe needs to pay tax at rate 21.9% on coupon payments. Assume the tax on coupon is paid immediately on the coupon payment date. a. 101.9133 b. 102.9603 c. 102.9591 d. 102.9019

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