Ex7-5: Using following information, calculate the impact of one percent increase in market interest rate on the bond price. Financial Term Today One year later Market interest rate 3% 4% Coupon rate 3% 3% (semi-annual payment) Face value $1,000 $1,000 Maturity 10 years ? Price ? ? YTM 3% ?

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
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Ex7-5: Using following information, calculate
the impact of one percent increase in market
interest rate on the bond price.
Financial Term
Today
One year later
Market interest rate
3%
4%
Coupon rate
3%
3%
(semi-annual payment)
Face value
$1,000
$1,000
Maturity
10 years
?
Price
?
?
YTM
3%
?
Transcribed Image Text:Ex7-5: Using following information, calculate the impact of one percent increase in market interest rate on the bond price. Financial Term Today One year later Market interest rate 3% 4% Coupon rate 3% 3% (semi-annual payment) Face value $1,000 $1,000 Maturity 10 years ? Price ? ? YTM 3% ?
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