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 6 years. The yield to maturity is 2.5%. Find the price P of the bond.

F = €1 000coupon = 5%YTM = 2.5%n = 6

P = €

2.Easy

A bond with a face value of €1 000 pays an annual coupon of 4.5% and trades at €1 020. Find its current yield CY in percent.

F = €1 000coupon = 4.5%P = €1 020

CY = %

3.Medium

You buy a bond with 10 years to maturity (face value €1 000, annual coupon 4.5%) when its yield to maturity is 3%. One year later, just after receiving the first coupon, you sell it when the yield to maturity is 4.5%. Find your holding period return HPR in percent.

F = €1 000coupon = 4.5%n = 10y₀ = 3%y₁ = 4.5%

HPR = %

4.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 4% per year. Find the price P of the bond.

F = €1 000coupon = 2%YTM = 4%n = 9

P = €

5.Hard

A bond with a face value of €1 000 pays a 4% annual coupon in two half-yearly payments and matures in 3 years. It sells for €871. Find its yield to maturity YTM as an annual rate (twice the half-yearly yield), in percent.

F = €1 000coupon = 4% (2×)n = 3P = €871

YTM = %

6.Hard

A bond with a face value of €1 000 and an annual coupon of 4% matures in 4 years and sells for €1 075. Find its yield to maturity YTM in percent.

F = €1 000coupon = 4%n = 4P = €1 075

YTM = %

Answer key

1. P = 1138 €
2. CY = 4.412 %
3. HPR = −7.354 %
4. P = 850.1 €
5. YTM = 9.002 %
6. YTM = 2.029 %

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