FREE Financial Mathematics Bond Basics Questions and Answers

Question 1

A bond with a face value of $1,000 has a coupon rate of 6%. What is the annual coupon payment?

Accepted Answer

$60

Answer

$50

Answer

$70

Answer

$80

Question 2

A bond with a face value of $1,000 is currently trading at $950. Its annual coupon payment is $50. What is the current yield?

Accepted Answer

5.26%

Answer

5.00%

Answer

4.95%

Answer

4.80%

Question 3

A bond with a face value of $1,000 pays an annual coupon of $80 and matures in 5 years. If the required rate of return is 6%, what is the bond’s price?

Accepted Answer

$1,046.22

Answer

$1,050.00

Answer

$1,070.24

Answer

$1,080.00

Question 4

A bond with a current price of $950, a face value of $1,000, and annual coupons of $60 matures in 3 years. What is the YTM?

Accepted Answer

7.0%

Answer

6.5%

Answer

7.2%

Answer

7.5%

Question 5

A zero-coupon bond with a face value of $1,000 matures in 10 years. If the required rate of return is 5%, what is the price of the bond?

Accepted Answer

$613.91

Answer

$620.00

Answer

$630.17

Answer

$650.00

A bond with a face value of $1,000 has a coupon rate of 6%.What is the annual coupon payment?

A bond with a face value of $1,000 has a coupon rate of 6%.
What is the annual coupon payment?