[zacharie101]

I probably did these wrong but these are done using excel please tell me if I did them right


Problem #1- On August 1, 2004, you are offered the following bond:
Face value: $1,000
Coupon rate: 12%
Coupon payments: Once a year starting on August 1, 2005
Maturity date: August 1, 2012
Bond price: $1,252.00
Compute the bond’s yield to maturity (YTM)

=YIELD("01-Aug-04","01-Aug-12",12%,1252/1000,1000,1) = 9.584713065



Problem #2- On September 10, 2003, you are offered the following bond:
Face value: $1,000.00
Coupon rate: 12%
Coupon payments: Once a year starting on August 1, 2004
Maturity date: August 1, 2012
Bond price: $1,252.00
Compute the bond’s yield to maturity (YTM)


=YIELD("10-sep-03","01-Aug-12",12%,1252/1000,1000,1) = 5.786300818


Problem #3- You have been offered a U.S. Treasury bill on July 15. The face value of the bill is $10,000 and the price is $9,925. The bill matures on January 14.. Compute the yield on the bill.

I dont know why but I get #NUM when I do:
=YIELDDISC("15-jul","14-jan",9925/10000,10000)

15-Jul - 14 Jan = 183 days between

Rate is 2%
=RATE(183/365,0,9925,-10000,1)



Problem #4- On February 26, 2001 an 8.2% Duke Energy Corp. bond maturing January 15, 2007 is priced at 103.790 per face value (this price does not include the accrued interest). The bond was originally issued in 1992. The bond pays interest semiannually, on January 15th and July 15th of each year. Compute the accrued interest and the yield to maturity of the bond.

Today's date 26-Feb-01
Last coupon date 15-Jan-92 I made up the Jan 15
Next coupon date 16-Jan-07
Days since last coupon 3330 Todays date - Last coupon date
Days between coupons 5480 Next coupon date - Last coupon date
Semi-annual coupon =PRICE(B14,B16,8.2%,B21,100,2) = 1.0379
Accrued interest .630694708 3330/5480*1.0379
YTM 5.67226615 =YIELD(26-Feb-01,16-Jan-07,8.2%,103.79/100,100,2)




Problem #5- The ABC Corp. needs to raise funds to finance a plant expansion, and it has decided to issue 20-year zero coupon bonds to raise the capital. If YTM’s are currently 9%, what will these bonds sell for at issuance?

=PV(9%,20,0,-1000) = 178.43


Problem #6- HIJ has 10 % coupon bonds with 9 years left to maturity. The bonds make annual interest payments. If the bond currently sells for $1075.25, what is the YTM?

=YIELD("01-jan-00","01-jan-09",10%,1075.25,1000,1) = .001572991

Problem #7- The EFG Corp. issued 12-year bonds 2 years ago at a coupon rate of 7.8%. The bonds make semi-annual payments. If the bonds sell at 108 (108% of par) what is the YTM?

=YIELD("01-jan-00","01-jan-12",7.8%,108/100,100,2) = 7.22222


Problem #8- what would you pay for a bond that pays an annual coupon of $45, has a face value of $1,000, matures in 11 years, and has a YTM of 10%?


=PRICE("01-jan-00","01-jan-11",45/1000,10%,1000,1) = 379.721674

[ArcSine]

(5) is correct.

On the others, you're using the right Excel functions, but in each case you need to express the prices in the exact syntax Excel requires, as I mentioned in my response to your other question. Most of your problems on this set of questions will become correct when you make that adjustment.

To serve as an example, the 4th and 5th arguments in your Yield function for Problem (1) should be 125.2 and 100, respectively. Note that the way you have the fraction results in the amount 1.252, which produces an incorrect result.

In addition:

• On (3) all you need is the YieldDisc function. However, the dates need to be entered using the Date() function; it's probably why it's returning an error message to you. See Excel's help function for the YieldDisc function, and you'll see what I mean.

• On (4), for the accrued interest, note that as of the assumed current date (Feb 26, 2001), the most recent coupon date would've been Jan 15 2001. Interest has only accrued since that date, not since Jan of 1992.

• On (7) they are indeed 12-year bonds, but they were issued two years ago. Hence the maturity date is only 10 years away, not 12.