The S.Alam Company bond currently sells for $955, has a 12% coupon rate and a $1,000 par value, pays interest annually, And has 15 years to maturity. Calculate the approximate yield to maturity on this bond through trial and error Explain the relationship that exists between the coupon rate and yield to maturity and the par value and market value of a bond.
The S.Alam Company bond currently sells for $955, has a 12% coupon rate and a $1,000 par value, pays interest annually, And has 15 years to maturity. Calculate the approximate yield to maturity on this bond through trial and error Explain the relationship that exists between the coupon rate and yield to maturity and the par value and market value of a bond.
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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The S.Alam Company bond currently sells for $955, has a 12% coupon rate and a $1,000 par value, pays interest annually, And has 15 years to maturity.
- Calculate the approximate yield to maturity on this bond through trial and error
- Explain the relationship that exists between the coupon rate and yield to maturity and the par value and market
value of a bond.
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