Question 1

A $10,000, 14% coupon, 25-year bond issued on June 15, 1984, was purchased on March 20, 1987, to yield 9% to maturity, and then sold on April 20, 1990, to yield 11.5% to maturity. What was the investor's capital gain or loss:
a) In dollars?
b) As a percentage of his original investment?

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Question 2

A $1000 face value, 7.6% coupon bond pays interest on May 15 and November 15. If its flat price on August 1 was $1065.50, at what price (expressed as a percentage of face value) would the issue have been reported in the financial pages?

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Question 3

A $5000 bond was sold for $4860 (flat) on September 17. If the bond pays $200 interest on June 1 and December 1 of each year until maturity, what price (expressed as a percentage of face value) would have been quoted for bonds of this issue on September 17?

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Question 4

If a broker quotes a price of 108.50 for a bond on October 23, what amount will a client pay per $1000 face value? The 7.2% coupon rate is payable on March 1 and September 1 of each year. The relevant February has 28 days.

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Question 5

Calculate the quoted price on April 15, 2006 of the bond outlined below. (Assume that the face value is $1000, that the purchase price is $958.06, that the bond interest is paid semiannually, that the bond was originally issued at its face value, that the bond is redeemed at their face value maturity and that the market rate of return is compounded semiannually.)

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Question 6

Calculate the quoted price on June 1, 2001 of the bond outlined below. (Assume that the face value is $1000, that the purchase price is $1239.47, that the bond interest is paid semiannually, that the bond was originally issued at its face value, that the bond is redeemed at their face value maturity and that the market rate of return is compounded semiannually.)

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Question 7

Using the bond yield given in the final column of Table 15.2, verify the September 22, 2009 quoted price for the Province of New Brunswick 4.4% coupon bond, maturing June 3, 2019.

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Question 8

Using the bond yield given in the final column of Table 15.2, verify the September 22, 2009 quoted price for the Province of Ontario 5.85% coupon bond, maturing March 8, 2033.

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Question 9

Using the bond yield given in the final column of Table 15.2, verify the September 22, 2009 quoted price for the Province of British Columbia 5.7% coupon bond, maturing June 18, 2029.

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Question 10

Using the bond price given in the second-to-last column of Table 15.2, verify the September 22, 2009 yield (to maturity) for the Newfoundland Municipal Financing Authority 5.1% coupon bond, maturing March 29, 2018.

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Question 11

Using the bond price given in the second-to-last column of Table 15.2, verify the September 22, 2009 yield (to maturity) for the City of Toronto 4.375% coupon bond, maturing October 28, 2015.

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Question 12

Using the bond price given in the second-to-last column of Table 15.2, verify the September 22, 2009 yield (to maturity) for the TransCanada Pipelines Ltd. 8.29% coupon bond, maturing February 5, 2026.

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Question 13

Using the bond price given in the second-to-last column of Table 15.2, verify the September 22, 2009 yield (to maturity) for the ING Canada Inc. 5.41% coupon bond, maturing September 3, 2019.

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Question 14

For the sinking fund calculate (rounded to the nearest dollar) a) the size of the periodic sinking fund payment and b) the balance in the sinking fund at the time indicated in the last column. (Round the sinking fund payment to the nearest dollar before calculating the balance.)

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