The Rapture Marine Corporation has $1,000 face value bonds issued with a 6% coupon. They mature in 10 years, call for semi-annual payments,and currently have a yield to maturity of 8%. What will happen to the price of the bond if the market interest rate suddenly decreases to 4%?O The bond price will increase but still trade at a discount.O The bond price will increase and trade at a premiumO The bond price will decrease but still trade at a premiumO The bond price will decrease and trade at a discountO The bond price will remain unchanged

GIVEN, PAR =$1000 COUPON RATE =6% N=10 YTM =8%

The Rapture Marine Corporation has $1,000 face value bonds issued with a 6% coupon. They mature in 10 years, call for semi-annual payments, and currently have a yield to maturity of 8%. What will happen to the price of the bond if the market interest rate suddenly decreases to 4%? The bond price will increase but still trade at a discount. The bond price will increase and trade at a premium The bond price will decrease but still trade at a premium O The bond price will decrease and trade at a discount The bond price will remain unchanged

The Rapture Marine Corporation has $1,000 face value bonds issued with a 6% coupon. They mature in 10 years, call for semi-annual payments, and currently have a yield to maturity of 8%. What will happen to the price of the bond if the market interest rate suddenly decreases to 4%? The bond price will increase but still trade at a discount. The bond price will increase and trade at a premium The bond price will decrease but still trade at a premium O The bond price will decrease and trade at a discount The bond price will remain unchanged

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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