FIXED
INCOME SECURITIES 9-29
PRACTICE EXERCISE 9.3
Directions: Use the bond features on your calculator to calculate the correct answer to
each question. Check your solutions with the Answer Key on the next page.
8. A new Eurobond issue is available to investors. The bonds carry a 7.375% coupon rate,
have a maturity of 10 years, and are priced to yield 8.0%.
What price percentage would investors expect to pay for the new bonds? Give your
answer in percentage terms.
______________%
9. A Eurobond with five years to maturity has a percentage price of 97.85%. If the
coupon rate of the security is 6.325%, what is the yield to maturity of the bond?
______________%