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 zero-coupon bond with a face value of €1 000 matures in 4 years and costs €888 today. Find its yield to maturity YTM in percent.

F = €1 000n = 4P = €888

YTM = %

2.Easy

A bond with a face value of €1 000 pays an annual coupon of 4.5% and matures in 8 years. The yield to maturity is 4%. Find the price P of the bond.

F = €1 000coupon = 4.5%YTM = 4%n = 8

P = €

3.Medium

A bond with a face value of €1 000 pays an annual coupon of 3% and matures in 13 years. Its yield to maturity changes from 6% to 6.5%. By how much ΔP does the bond price change?

F = €1 000coupon = 3%n = 13y₁ = 6%y₂ = 6.5%

ΔP = €

4.Medium

You buy a bond with 8 years to maturity (face value €1 000, annual coupon 7%) when its yield to maturity is 3.5%. One year later, just after receiving the first coupon, you sell it when the yield to maturity is 4%. Find your holding period return HPR in percent.

F = €1 000coupon = 7%n = 8y₀ = 3.5%y₁ = 4%

HPR = %

5.Hard

A bond with a face value of €1 000 pays an annual coupon of 5% and matures in 4 years. The yield to maturity is 6%. Find the Macaulay duration D in years.

F = €1 000coupon = 5%n = 4YTM = 6%

D = years

6.Hard

A bond with a face value of €1 000 and an annual coupon of 4% matures in 7 years and sells for €940. Find its yield to maturity YTM in percent.

F = €1 000coupon = 4%n = 7P = €940

YTM = %

Answer key

1. YTM = 3.014 %
2. P = 1034 €
3. ΔP = −35.41 €
4. HPR = 0.7636 %
5. D = 3.718 years
6. YTM = 5.038 %

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