A $50,000 Petronas Corp, bond carrying a 12% coupon is currently priced to yield 4% compounded semiannually until maturity. If the bond price abruptly falls by $1,250, what is the change in the nomuna peld to maturity if the bond has four years remaining to maturity?

A $50,000 Petronas Corp, bond carrying a 12% coupon is currently priced to yield 4% compounded semiannually until maturity. If the bond price abruptly falls by $1,250, what is the change in the nomuna peld to maturity if the bond has four years remaining to maturity?

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

Section: Chapter Questions

Problem 1PS

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Question

A $50,000 Petronas Corp, bond carrying a
12% coupon is currently priced to yield 4%
compounded semiannually until maturity. If
the bond price abruptly falls by $1,250, what
is the change in the nomuna peld to
maturity if the bond has four years
remaining to maturity?

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