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.

New worksheet Practise online with hints

For teachers: free to print, copy and use in class. Every new worksheet has new values and its own answer key. A link to ExamProblems on your course page is appreciated.

Name: ____________________ Date: ____________

1.Easy

A bond with a face value of €1 000 pays an annual coupon of 7% and trades at €1 020. Find its current yield CY in percent.

F = €1 000coupon = 7%P = €1 020

CY = %

2.Easy

A zero-coupon bond pays €1 000 in 8 years and nothing before. The yield to maturity is 5% per year. Find the price P of the bond.

F = €1 000n = 8YTM = 5%

P = €

3.Medium

A bond with a face value of €1 000 pays a 2% annual coupon in two half-yearly payments and matures in 9 years. The yield to maturity is 9% per year. Find the price P of the bond.

F = €1 000coupon = 2%YTM = 9%n = 9

P = €

4.Medium

A bond with a face value of €1 000 pays a 6% annual coupon in two half-yearly payments and matures in 8 years. The yield to maturity is 5% per year. Find the price P of the bond.

F = €1 000coupon = 6%YTM = 5%n = 8

P = €

5.Hard

A bond with a face value of €1 000 and an annual coupon of 8% matures in 3 years and sells for €960. Find its yield to maturity YTM in percent.

F = €1 000coupon = 8%n = 3P = €960

YTM = %

6.Hard

A bond trades at €1 000 with a yield to maturity of 4% (annual compounding) and a Macaulay duration of 10.5 years. Use the modified duration to estimate the new price P if the yield falls by 75 basis points.

P₀ = €1 000y = 4%D = 10.5Δy = −75 bp

P = €

Answer key

1. CY = 6.863 %
2. P = 676.8 €
3. P = 574.4 €
4. P = 1065 €
5. YTM = 9.597 %
6. P = 1076 €

Full step-by-step solutions: practise this topic on examproblems.com.