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 6% and trades at €850. Find its current yield CY in percent.

F = €1 000coupon = 6%P = €850

CY = %

2.Easy

A zero-coupon bond with a face value of €1 000 matures in 10 years and costs €602 today. Find its yield to maturity YTM in percent.

F = €1 000n = 10P = €602

YTM = %

3.Medium

A bond with a face value of €1 000 pays a 2% annual coupon in two half-yearly payments and matures in 11 years. The yield to maturity is 4% per year. Find the price P of the bond.

F = €1 000coupon = 2%YTM = 4%n = 11

P = €

4.Medium

You buy a bond with 11 years to maturity (face value €1 000, annual coupon 2%) when its yield to maturity is 7%. One year later, just after receiving the first coupon, you sell it when the yield to maturity is 6.5%. Find your holding period return HPR in percent.

F = €1 000coupon = 2%n = 11y₀ = 7%y₁ = 6.5%

HPR = %

5.Hard

A bond with a face value of €1 000 pays a 6% annual coupon in two half-yearly payments and matures in 10 years. It sells for €1 258. Find its yield to maturity YTM as an annual rate (twice the half-yearly yield), in percent.

F = €1 000coupon = 6% (2×)n = 10P = €1 258

YTM = %

6.Hard

A bond with a face value of €1 000 and an annual coupon of 7% matures in 5 years and sells for €920. Find its yield to maturity YTM in percent.

F = €1 000coupon = 7%n = 5P = €920

YTM = %

Answer key

1. CY = 7.059 %
2. YTM = 5.206 %
3. P = 823.4 €
4. HPR = 11.43 %
5. YTM = 2.995 %
6. YTM = 9.06 %

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