Bond pricing & yield worksheet with answers

Free printable Bond pricing & yield worksheet: 6 problems from easy to exam level, with an answer key. Print it or save it as a PDF.

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1.Easy

A bond with a face value of €1 000 pays an annual coupon of 6% and matures in 3 years. The yield to maturity is 9%. Find the price P of the bond.

F = €1 000coupon = 6%YTM = 9%n = 3

P = €

2.Easy

A bond with a face value of €1 000 pays an annual coupon of 2% and matures in 5 years. The yield to maturity is 7%. Find the price P of the bond.

F = €1 000coupon = 2%YTM = 7%n = 5

P = €

3.Medium

A bond with a face value of €1 000 pays a 4.5% annual coupon in two half-yearly payments and matures in 6 years. The yield to maturity is 3% per year. Find the price P of the bond.

F = €1 000coupon = 4.5%YTM = 3%n = 6

P = €

4.Medium

A bond with a face value of €1 000 pays an annual coupon of 6% and matures in 7 years. Its yield to maturity changes from 2.5% to 1.5%. By how much ΔP does the bond price change?

F = €1 000coupon = 6%n = 7y₁ = 2.5%y₂ = 1.5%

ΔP = €

5.Hard

A bond trades at €1 045 with a yield to maturity of 6% (annual compounding) and a Macaulay duration of 5.1 years. Use the modified duration to estimate the new price P if the yield falls by 75 basis points.

P₀ = €1 045y = 6%D = 5.1Δy = −75 bp

P = €

6.Hard

A bond with a face value of €1 000 and an annual coupon of 4% matures in 7 years and sells for €940. Find its yield to maturity YTM in percent.

F = €1 000coupon = 4%n = 7P = €940

YTM = %

Answer key

1. P = 924.1 €
2. P = 795 €
3. P = 1082 €
4. ΔP = 74.69 €
5. P = 1083 €
6. YTM = 5.038 %

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