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 5% and matures in 8 years. The yield to maturity is 9%. Find the price P of the bond.

F = €1 000coupon = 5%YTM = 9%n = 8

P = €

2.Easy

A bond with a face value of €1 000 pays an annual coupon of 8% and matures in 5 years. The yield to maturity is 2.5%. Find the price P of the bond.

F = €1 000coupon = 8%YTM = 2.5%n = 5

P = €

3.Medium

You buy a bond with 11 years to maturity (face value €1 000, annual coupon 7%) when its yield to maturity is 4%. One year later, just after receiving the first coupon, you sell it when the yield to maturity is 5%. Find your holding period return HPR in percent.

F = €1 000coupon = 7%n = 11y₀ = 4%y₁ = 5%

HPR = %

4.Medium

A bond with a face value of €1 000 pays an annual coupon of 4.5% and matures in 8 years. Its yield to maturity changes from 6% to 5%. By how much ΔP does the bond price change?

F = €1 000coupon = 4.5%n = 8y₁ = 6%y₂ = 5%

ΔP = €

5.Hard

A bond with 15 years to maturity (face value €1 000, annual coupon 7%) sells for €1 268. The issuer can call it in 4 years at a call price of €1 070. Find the yield to call YTC in percent.

F = €1 000coupon = 7%P = €1 268call price = €1 070call in 4 years

YTC = %

6.Hard

A bond with 16 years to maturity (face value €1 000, annual coupon 6%) sells for €1 108. The issuer can call it in 5 years at a call price of €1 060. Find the yield to call YTC in percent.

F = €1 000coupon = 6%P = €1 108call price = €1 060call in 5 years

YTC = %

Answer key

1. P = 778.6 €
2. P = 1256 €
3. HPR = −3.039 %
4. ΔP = 60.83 €
5. YTC = 1.716 %
6. YTC = 4.625 %

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