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Question 10

Suppose the US government is issuing a $1,000 PAR value coupon bond today. This bond will mature in 3 years from today. This Bond's annual coupon rate is 10%. Coupons are paid 1 time(s) in a year. The investors expect 4% annual return on this bond.

What is the present value of all coupon payments for this Bond? Enter your answer in the following format: 123.45 Hint: Answer is between 249.76 and 305.26

Question 11

Consider two Bonds: Ford Motor Company's Bond has $1,000 face value,10-year maturity, pays 5% annual coupon once a year. Tesla's Bond has $1,000 face value,10-year maturity, pays 10% annual coupon once a year. Assume the interest rates (hence YTM) changed from 9% to 11% for both the Bonds.

By what percentage will the Tesla's Bond price change? Enter your answer in the following format: + or - 0.1234 Hint: Answer is between -0.1064 and -0.1261

Question 12

Suppose the US government is issuing a $1,000 PAR value coupon bond today. This bond will mature in 3 years from today. This Bond's annual coupon rate is 10%. Coupons are paid 1 time(s) in a year. The investors expect 4% annual return on this bond.

What is the present value of the Bond's PAR (also known as the face value or principal) for this Bond? Enter your answer in the following format: 123.45 Hint: Answer is between 817.88 and 995.68

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