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 zero-coupon bond with a face value of €1 000 matures in 7 years and costs €711 today. Find its yield to maturity YTM in percent.

F = €1 000n = 7P = €711

YTM = %

2.Easy

A bond with a face value of €1 000 pays an annual coupon of 4% and matures in 3 years. The yield to maturity is 3.5%. Find the price P of the bond.

F = €1 000coupon = 4%YTM = 3.5%n = 3

P = €

3.Medium

A bond with a face value of €1 000 pays a 5% annual coupon in two half-yearly payments and matures in 7 years. The yield to maturity is 9% per year. Find the price P of the bond.

F = €1 000coupon = 5%YTM = 9%n = 7

P = €

4.Medium

A bond with a face value of €1 000 pays a 7% annual coupon in two half-yearly payments and matures in 12 years. The yield to maturity is 9% per year. Find the price P of the bond.

F = €1 000coupon = 7%YTM = 9%n = 12

P = €

5.Hard

A bond trades at €1 035 with a yield to maturity of 6% (annual compounding) and a Macaulay duration of 11.4 years. Use the modified duration to estimate the new price P if the yield falls by 75 basis points.

P₀ = €1 035y = 6%D = 11.4Δy = −75 bp

P = €

6.Hard

A bond with a face value of €1 000 and an annual coupon of 3% matures in 8 years and sells for €870. Find its yield to maturity YTM in percent.

F = €1 000coupon = 3%n = 8P = €870

YTM = %

Answer key

1. YTM = 4.993 %
2. P = 1014 €
3. P = 795.5 €
4. P = 855 €
5. P = 1118 €
6. YTM = 5.012 %

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