Two $1,000 face-value bonds, redeemable on the same date at par to yield 4.5% have annual coupon rate of r and 2r. If the total purchase price of the two bonds is $2,153.52 and the difference of the bond prices is $307.04, find r.
Two $1,000 face-value bonds, redeemable on the same date at par to yield 4.5% have annual coupon rate of r and 2r. If the total purchase price of the two bonds is $2,153.52 and the difference of the bond prices is $307.04, find r.
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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![3. Two $1,000 face-value bonds, redeemable on the same date at par to yield 4.5%
have annual coupon rate of r and 2r. If the total purchase price of the two bonds
is $2,153.52 and the difference of the bond prices is $307.04, find r.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F283f8a0a-7439-4722-89dc-f854e9302374%2Fe1a44dce-e217-4f05-aedb-a11c5adb07cd%2Fxtrftob_processed.png&w=3840&q=75)
Transcribed Image Text:3. Two $1,000 face-value bonds, redeemable on the same date at par to yield 4.5%
have annual coupon rate of r and 2r. If the total purchase price of the two bonds
is $2,153.52 and the difference of the bond prices is $307.04, find r.
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