Understanding Bond Pricing Suppose your friend tells you that she recently purchased a 20-year $4,000.00 bond with a 5% coupon. A month later, she saw it quoted at 97:12, but she does not know what this means. You can tell by the way the bond is priced that she has a explain that the market price of her bond is now , meaning it is now a bond; otherwise it would have been priced bond. You Based on the market price of the bond you calculated, you can tell that market interest rates have gone since the bond was issued. The current yield of the bond is now
Understanding Bond Pricing Suppose your friend tells you that she recently purchased a 20-year $4,000.00 bond with a 5% coupon. A month later, she saw it quoted at 97:12, but she does not know what this means. You can tell by the way the bond is priced that she has a explain that the market price of her bond is now , meaning it is now a bond; otherwise it would have been priced bond. You Based on the market price of the bond you calculated, you can tell that market interest rates have gone since the bond was issued. The current yield of the bond is now
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
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8. Bond pricing
Understanding Bond Pricing)
Suppose your friend tells you that she recently purchased a 20-year $4,000.00 bond with a 5% coupon. A month later, she saw it quoted at 97:12, but
she does not know what this means.
You can tell by the way the band is priced that she has a
explain that the market price of her bond is now
meaning it is now a
bond; otherwise it would have been priced
bond.
You
Based on the market price of the bond you calculated, you can tell that market interest rates have gone since the bond was issued. The current
Yield of the bond is now
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