A $1,500 face value corporate bond with a 7.30 percent coupon (paid semiannually) has 15 years left to maturity. It has had a credit rating of BB and a yield to maturity of 8.7 percent. The firm recently became more financially stable and the rating agency is upgrading the bonds to BBB. The new appropriate discount rate will be 7.6 percent. What will be the change in the bond's price in dollars and percentage terms? (Round your answers to 3 decimal places. (e.g., 32.161)) Change in the bond's price in dollars Change in the bond's price in percentage

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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A $1,500 face value corporate bond with a 7.30 percent coupon (paid semiannually) has 15 years left to maturity. It has had a credit
rating of BB and a yield to maturity of 8.7 percent. The firm recently became more financially stable and the rating agency is upgrading
the bonds to BBB. The new appropriate discount rate will be 7.6 percent. What will be the change in the bond's price in dollars and
percentage terms? (Round your answers to 3 decimal places. (e.g., 32.161))
Change in the bond's price in dollars
Change in the bond's price in percentage
Transcribed Image Text:A $1,500 face value corporate bond with a 7.30 percent coupon (paid semiannually) has 15 years left to maturity. It has had a credit rating of BB and a yield to maturity of 8.7 percent. The firm recently became more financially stable and the rating agency is upgrading the bonds to BBB. The new appropriate discount rate will be 7.6 percent. What will be the change in the bond's price in dollars and percentage terms? (Round your answers to 3 decimal places. (e.g., 32.161)) Change in the bond's price in dollars Change in the bond's price in percentage
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