omi, Inc. has an 8% semi-annual bond that is priced at $1,060.47. The YTM on the bond is 7%. How many years do these bonds have until they mature? One year later, the yield in the market has fallen to 6 percent. What is the price of the bond now

omi, Inc. has an 8% semi-annual bond that is priced at $1,060.47. The YTM on the bond is 7%. How many years do these bonds have until they mature? One year later, the yield in the market has fallen to 6 percent. What is the price of the bond now

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter6: Fixed-income Securities: Characteristics And Valuation

Section: Chapter Questions

Problem 8P

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Question

Komi, Inc. has an 8% semi-annual bond that is priced at $1,060.47. The YTM on the bond is 7%.

How many years do these bonds have until they mature?

One year later, the yield in the market has fallen to 6 percent. What is the price of the bond now?

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