Two 15-year par value bonds, X and Y, each pay an annual coupon of 200 at the end of the year. The face amount of Bond X is one-half the face amount of Bond Y. At an annual effective yield of i, the price of Bond X is 2695.39 and the price of Bond Y is 3490.78.

Calculate the coupon rate for Bond X.

• 6.3%
• 7.4%
• 8.8%
• 10.0%
• 11.4%

A bank issues two 20-year bonds, A and B, each with annual coupons, an annual effective yield rate of 10%, and a face amount of 1000. The total combined price of these two bonds is 1600. Bond B's annual coupon rate is equal to Bond A's annual coupon rate plus 1 percentage point.

Calculate the annual coupon rate of Bond A

• 6.46%
• 7.15%
• 7.29%
• 8.02%
• 8.90%

Let A and B be bonds with semiannual coupons as described in the table below:

Calculate y.

• 8.45%
• 8.65%
• 8.85%
• 9.05%
• 9.25%

A bond with a face value of 1000 and a redemption value of 1080 has an annual coupon rate of 8% payable semiannually. The bond is bought to yield an annual nominal rate of 10% convertible semiannually. At this yield rate, the present value of the redemption value is 601 on the purchase date.

Calculate the purchase price of the bond.

• 911
• 923
• 956
• 974
• 984

A three-year bond with a face value of 1000 pays coupons semiannually. The bond is redeemable at face value. It is bought at issue at a price to produce an annual yield rate of 10% convertible semiannually. If the term of the bond is doubled and the yield rate remains the same, the purchase price would decrease by 49.

Calculate the amount of a coupon.

• 37
• 46
• 54
• 63
• 74

A ten-year 1000 par value bond with coupons paid annually at an annual rate of r is callable at par at the end of the 6th , 7th , 8th , or 9th year. The price of the bond is 1023. If the bond is called in the worst-case scenario for the bond investor, the resulting annual effective yield rate, i, is 96% of r.

Calculate i.

• 4.41%
• 7.46%
• 8.36%
• 10.56%
• 14.32%

Bond X and Bond Y are n-year bonds with face amount of 10,000 and semiannual coupons, each yielding an annual nominal interest rate of 7% convertible semiannually. Bond X has an annual coupon rate of 6% and redemption value c. Bond Y has an annual coupon rate of 5% and redemption value c + 50. The price of Bond X exceeds the price of Bond Y by 969.52.

Calculate n.

• 14
• 17
• 23
• 34
• 46

A six-year 1000 face amount bond has an annual coupon rate of 8% semiannually. The bond currently sells for 911.37.

Calculate the annual effective yield rate.

• 7.29%
• 8.00%
• 9.72%
• 10.00%
• 10.25%

An investor pays 962.92 for a ten-year bond with an annual coupon rate of 8% paid semiannually. The annual nominal yield rate is 10% convertible semiannually.

Calculate the discount of this purchase.

• 117
• 122
• 127
• 132
• 137

A life insurance company sells a two-year immediate annuity with annual payments of 1000 for a price of 1817. The investment actuary invests the 1817 in two zero-coupon bonds

• The first bond matures in one year and earns an annual effective interest rate of 6%. The second bond matures in two years and earns an annual effective interest rate of 7%.
• 999.35 is invested in the first bond and 817.65 is invested in the second bond.
• The two bonds are held to maturity

As long as the effective annual one-year reinvestment rate is at least X% one year from now, the principal and interest earned will be sufficient to make the two annuity payments.

Calculate X.

• 6.0
• 6.6
• 7.0
• 7.3
• 7.7