4 years ago, you purchased a corporate bond for R975.30. At the time, the bond had a YTM of 9.25% and 8 years left to maturity. Today, the YTM on your bond is 6%. With this information, can you calculate the current market price of your bond? Assume fixed annual coupon payments and a par value of R1,000 A. R 925 B. R 1000 C. R 1079.20 D. R 1097.02
4 years ago, you purchased a corporate bond for R975.30. At the time, the bond had a YTM of 9.25% and 8 years left to maturity. Today, the YTM on your bond is 6%. With this information, can you calculate the current market price of your bond? Assume fixed annual coupon payments and a par value of R1,000 A. R 925 B. R 1000 C. R 1079.20 D. R 1097.02
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
Problem 8P
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4 years ago, you purchased a corporate bond for R975.30. At the time, the bond had a YTM of 9.25% and 8 years left to maturity. Today, the YTM on your bond is 6%. With this information, can you calculate the current market price of your bond? Assume fixed annual coupon payments and a par value of R1,000
A. R 925
B. R 1000
C. R 1079.20
D. R 1097.02
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