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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Name: ____________________   Date: ____________

1.Easy
years01234567€615€1 000

A zero-coupon bond with a face value of €1 000 matures in 7 years and costs €615 today. Find its yield to maturity YTM in percent.

F = €1 000n = 7P = €615
YTM = %
2.Easy
years0123…8€30€30€30 + €1 000P = ?

A bond with a face value of €1 000 pays an annual coupon of 3% and matures in 8 years. The yield to maturity is 8%. Find the price P of the bond.

F = €1 000coupon = 3%YTM = 8%n = 8
P = €
3.Medium

You buy a bond with 7 years to maturity (face value €1 000, annual coupon 4%) when its yield to maturity is 6%. One year later, just after receiving the first coupon, you sell it when the yield to maturity is 7.5%. Find your holding period return HPR in percent.

F = €1 000coupon = 4%n = 7y0 = 6%y1 = 7.5%
HPR = %
4.Medium

You buy a bond with 10 years to maturity (face value €1 000, annual coupon 8%) when its yield to maturity is 5.5%. One year later, just after receiving the first coupon, you sell it when the yield to maturity is 6%. Find your holding period return HPR in percent.

F = €1 000coupon = 8%n = 10y0 = 5.5%y1 = 6%
HPR = %
5.Hard
half-years0123…20€1 176€22.50€22.50€22.50 + €1 000

A bond with a face value of €1 000 pays a 4.5% annual coupon in two half-yearly payments and matures in 10 years. It sells for €1 176. Find its yield to maturity YTM as an annual rate (twice the half-yearly yield), in percent.

F = €1 000coupon = 4.5% (2×)n = 10P = €1 176
YTM = %
6.Hard
years012345€895€40€40 + €1 000

A bond with a face value of €1 000 and an annual coupon of 4% matures in 5 years and sells for €895. Find its yield to maturity YTM in percent.

F = €1 000coupon = 4%n = 5P = €895
YTM = %

Answer key

  1. 1. YTM = 7.192 %
  2. 2. P = 712.7 €
  3. 3. HPR = −1.423 %
  4. 4. HPR = 2.322 %
  5. 5. YTM = 2.5 %
  6. 6. YTM = 6.529 %

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