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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Name: ____________________ Date: ____________

1.Easy

A bond with a face value of €1 000 pays an annual coupon of 8% and matures in 7 years. The yield to maturity is 7%. Find the price P of the bond.

F = €1 000coupon = 8%YTM = 7%n = 7

P = €

2.Easy

A zero-coupon bond with a face value of €1 000 matures in 8 years and costs €677 today. Find its yield to maturity YTM in percent.

F = €1 000n = 8P = €677

YTM = %

3.Medium

A bond with a face value of €1 000 pays a 5% annual coupon in two half-yearly payments and matures in 6 years. The yield to maturity is 8% per year. Find the price P of the bond.

F = €1 000coupon = 5%YTM = 8%n = 6

P = €

4.Medium

You buy a bond with 5 years to maturity (face value €1 000, annual coupon 6%) when its yield to maturity is 5%. One year later, just after receiving the first coupon, you sell it when the yield to maturity is 6%. Find your holding period return HPR in percent.

F = €1 000coupon = 6%n = 5y₀ = 5%y₁ = 6%

HPR = %

5.Hard

A bond with a face value of €1 000 and an annual coupon of 8% matures in 9 years and sells for €940. Find its yield to maturity YTM in percent.

F = €1 000coupon = 8%n = 9P = €940

YTM = %

6.Hard

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 6%. Find the Macaulay duration D in years.

F = €1 000coupon = 5%n = 6YTM = 6%

D = years

Answer key

1. P = 1054 €
2. YTM = 4.997 %
3. P = 859.2 €
4. HPR = 1.601 %
5. YTM = 9.001 %
6. D = 5.31 years

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