1. Madsen Motors's bonds have 16 years remaining to maturity. Interest is paid annually, they have a $1,000 par value, the coupon interest rate is 8%, and the yield to maturity is 10%. What is the bond's current market price? Round your answer to the nearest cent. $ 2. A bond has a $1,000 par value, 15 years to maturity, and an 8% annual coupon and sells for $1,080. a. What is its yield to maturity (YTM)? Round your answer to two decimal places. = % b. Assume that the yield to maturity remains constant for the next three years. What will the price be 3 years from today? Do not round intermediate calculations. Round your answer to the nearest cent. = $
1. Madsen Motors's bonds have 16 years remaining to maturity. Interest is paid annually, they have a $1,000 par value, the coupon interest rate is 8%, and the yield to maturity is 10%. What is the bond's current market price? Round your answer to the nearest cent. $ 2. A bond has a $1,000 par value, 15 years to maturity, and an 8% annual coupon and sells for $1,080. a. What is its yield to maturity (YTM)? Round your answer to two decimal places. = % b. Assume that the yield to maturity remains constant for the next three years. What will the price be 3 years from today? Do not round intermediate calculations. Round your answer to the nearest cent. = $
Chapter8: Analysis Of Risk And Return
Section: Chapter Questions
Problem 9P
Related questions
Question
1. Madsen Motors's bonds have 16 years remaining to maturity. Interest is paid annually, they have a $1,000 par value, the coupon interest rate is 8%, and the yield to maturity is 10%. What is the bond's current market price? Round your answer to the nearest cent.
$
2. A bond has a $1,000 par value, 15 years to maturity, and an 8% annual coupon and sells for $1,080.
a. What is its yield to maturity (YTM)? Round your answer to two decimal places.
= %
b. Assume that the yield to maturity remains constant for the next three years. What will the price be 3 years from today? Do not round intermediate calculations. Round your answer to the nearest cent.
= $
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