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 pays €1 000 in 10 years and nothing before. The yield to maturity is 2.5% per year. Find the price P of the bond.

F = €1 000n = 10YTM = 2.5%

P = €

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 4% annual coupon in two half-yearly payments and matures in 5 years. The yield to maturity is 8% per year. Find the price P of the bond.

F = €1 000coupon = 4%YTM = 8%n = 5

P = €

4.Medium

A bond with a face value of €1 000 pays a 4.5% annual coupon in two half-yearly payments and matures in 6 years. The yield to maturity is 7% per year. Find the price P of the bond.

F = €1 000coupon = 4.5%YTM = 7%n = 6

P = €

5.Hard

A bond with a face value of €1 000 pays an annual coupon of 4% and matures in 6 years. The yield to maturity is 5.5%. Find the Macaulay duration D in years.

F = €1 000coupon = 4%n = 6YTM = 5.5%

D = years

6.Hard

A bond with a face value of €1 000 pays a 4% annual coupon in two half-yearly payments and matures in 8 years. It sells for €767. Find its yield to maturity YTM as an annual rate (twice the half-yearly yield), in percent.

F = €1 000coupon = 4% (2×)n = 8P = €767

YTM = %

Answer key

1. P = 781.2 €
2. P = 676.8 €
3. P = 837.8 €
4. P = 879.2 €
5. D = 5.426 years
6. YTM = 7.999 %

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