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 bond with a face value of €1 000 pays an annual coupon of 4.5% and matures in 7 years. The yield to maturity is 2.5%. Find the price P of the bond.

F = €1 000coupon = 4.5%YTM = 2.5%n = 7

P = €

2.Easy

A bond with a face value of €1 000 pays an annual coupon of 6% and matures in 9 years. The yield to maturity is 9%. Find the price P of the bond.

F = €1 000coupon = 6%YTM = 9%n = 9

P = €

3.Medium

A bond with a face value of €1 000 pays an 8% annual coupon in two half-yearly payments and matures in 3 years. The yield to maturity is 5.5% per year. Find the price P of the bond.

F = €1 000coupon = 8%YTM = 5.5%n = 3

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 trades at €1 090 with a yield to maturity of 3% (annual compounding) and a Macaulay duration of 10.5 years. Use the modified duration to estimate the new price P if the yield falls by 50 basis points.

P₀ = €1 090y = 3%D = 10.5Δy = −50 bp

P = €

6.Hard

A bond with a face value of €1 000 and an annual coupon of 3% matures in 3 years and sells for €960. Find its yield to maturity YTM in percent.

F = €1 000coupon = 3%n = 3P = €960

YTM = %

Answer key

1. P = 1127 €
2. P = 820.1 €
3. P = 1068 €
4. P = 879.2 €
5. P = 1146 €
6. YTM = 4.454 %

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