Uliana Company wants to issue new 21-year bonds for some much-needed expansion projects. The company currently has 8.6 percent coupon bonds on the market that sell for $1,126, make semiannual payments, have a par value of $1,000, and mature in 21 years. What coupon rate should the company set on its new bonds if it wants them to sell at par?
Uliana Company wants to issue new 21-year bonds for some much-needed expansion projects. The company currently has 8.6 percent coupon bonds on the market that sell for $1,126, make semiannual payments, have a par value of $1,000, and mature in 21 years. What coupon rate should the company set on its new bonds if it wants them to sell at par?
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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Uliana Company wants to issue new 21-year bonds for some much-needed expansion projects. The company currently has 8.6 percent coupon bonds on the market that sell for $1,126, make semiannual payments, have a par value of $1,000, and mature in 21 years. What coupon rate should the company set on its new bonds if it wants them to sell at par?
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
coupon rat:?%
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