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 14 years and costs €758 today. Find its yield to maturity YTM in percent.

F = €1 000n = 14P = €758

YTM = %

2.Easy

A bond with a face value of €1 000 pays an annual coupon of 3% and matures in 3 years. The yield to maturity is 6%. Find the price P of the bond.

F = €1 000coupon = 3%YTM = 6%n = 3

P = €

3.Medium

A bond with a face value of €1 000 pays a 3% annual coupon in two half-yearly payments and matures in 7 years. The yield to maturity is 6% per year. Find the price P of the bond.

F = €1 000coupon = 3%YTM = 6%n = 7

P = €

4.Medium

You buy a bond with 12 years to maturity (face value €1 000, annual coupon 4%) 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 2.5%. Find your holding period return HPR in percent.

F = €1 000coupon = 4%n = 12y₀ = 3.5%y₁ = 2.5%

HPR = %

5.Hard

A bond with 20 years to maturity (face value €1 000, annual coupon 8%) sells for €1 299. The issuer can call it in 5 years at a call price of €1 080. Find the yield to call YTC in percent.

F = €1 000coupon = 8%P = €1 299call price = €1 080call in 5 years

YTC = %

6.Hard

A bond with a face value of €1 000 and an annual coupon of 3% matures in 4 years and sells for €1 080. Find its yield to maturity YTM in percent.

F = €1 000coupon = 3%n = 4P = €1 080

YTM = %

Answer key

1. YTM = 1.999 %
2. P = 919.8 €
3. P = 830.6 €
4. HPR = 12.82 %
5. YTC = 2.982 %
6. YTM = 0.9522 %

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