XYZ Corp. has a bond issue with a $1,000 par value and a 12% coupon rate. It pays interest semi-annually and has 10 years remaining to maturity. It just made a coupon payment (i.e., it has 10 coupon payments left to make). If bonds with similar risk and maturity have yields to maturity of 7%, What is the price of XYZ’s bond?
XYZ Corp. has a bond issue with a $1,000 par value and a 12% coupon rate. It pays interest semi-annually and has 10 years remaining to maturity. It just made a coupon payment (i.e., it has 10 coupon payments left to make). If bonds with similar risk and maturity have yields to maturity of 7%, What is the price of XYZ’s 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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XYZ Corp. has a bond issue with a $1,000 par value and a 12% coupon rate. It pays interest semi-annually and has 10 years remaining to maturity. It just made a coupon payment (i.e., it has 10 coupon payments left to make). If bonds with similar risk and maturity have yields to maturity of 7%, What is the price of XYZ’s bond?
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