Suppose a ten-year, $1,000 bond with an 8.5% coupon rate and semiannual coupons is trading for $1,034.75. a. What is the bond's yield to maturity (expressed as an APR with semiannual compounding)? b. If the bond's yield to maturity changes to 9.5% APR, what will be the bond's price?
Suppose a ten-year, $1,000 bond with an 8.5% coupon rate and semiannual coupons is trading for $1,034.75. a. What is the bond's yield to maturity (expressed as an APR with semiannual compounding)? b. If the bond's yield to maturity changes to 9.5% APR, what will be the bond's price?
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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Hi I'am also stuck on this problem too can you help me with it
Suppose a ten-year, $1,000 bond with an 8.5%
coupon rate and semiannual coupons is trading for $1,034.75.
coupon rate and semiannual coupons is trading for $1,034.75.
a. What is the bond's yield to maturity (expressed as an APR with semiannual compounding)?
b. If the bond's yield to maturity changes to
bond's price ?
9.5%
APR, what will be the Expert Solution
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