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 bond with a face value of €1 000 pays an annual coupon of 7% and matures in 9 years. The yield to maturity is 2.5%. Find the price P of the bond.

F = €1 000coupon = 7%YTM = 2.5%n = 9

P = €

2.Easy

A zero-coupon bond pays €1 000 in 10 years and nothing before. The yield to maturity is 3% per year. Find the price P of the bond.

F = €1 000n = 10YTM = 3%

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 3 years. The yield to maturity is 5% per year. Find the price P of the bond.

F = €1 000coupon = 4%YTM = 5%n = 3

P = €

4.Medium

A bond with a face value of €1 000 pays a 6% annual coupon in two half-yearly payments and matures in 4 years. The yield to maturity is 4% per year. Find the price P of the bond.

F = €1 000coupon = 6%YTM = 4%n = 4

P = €

5.Hard

A bond with a face value of €1 000 and an annual coupon of 5% matures in 3 years and sells for €960. Find its yield to maturity YTM in percent.

F = €1 000coupon = 5%n = 3P = €960

YTM = %

6.Hard

A bond trades at €1 075 with a yield to maturity of 7% (annual compounding) and a Macaulay duration of 4.5 years. Use the modified duration to estimate the new price P if the yield rises by 50 basis points.

P₀ = €1 075y = 7%D = 4.5Δy = +50 bp

P = €

Answer key

1. P = 1359 €
2. P = 744.1 €
3. P = 972.5 €
4. P = 1073 €
5. YTM = 6.511 %
6. P = 1052 €

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