Your firm has a credit rating of A You notice that the credit spread for five-year maturity A debt is 81 basis points (0 81%) Your fem's five-year has semi-annual coupons and a coupon rate of 4% You see that new five-year Government of Canada bonds are being issued with a YTM of 3% What should the price of your outstanding five-year bonds be Assume a par value of $100 The price of your outstanding five-year bonds should be (Round to the nearest cent)
Your firm has a credit rating of A You notice that the credit spread for five-year maturity A debt is 81 basis points (0 81%) Your fem's five-year has semi-annual coupons and a coupon rate of 4% You see that new five-year Government of Canada bonds are being issued with a YTM of 3% What should the price of your outstanding five-year bonds be Assume a par value of $100 The price of your outstanding five-year bonds should be (Round to the nearest cent)
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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Transcribed Image Text:Your firm has a credit rating of A. You notice that the credit spread for five-year maturity A debt is 81 basis points (0 81%) Your fem's five-year has semi-annual coupons and a
coupon rate of 4% You see that new five-year Government of Canada bonds are being issued with a YTM of 3% What should the price of your outstanding five-year bonds be
Assume a par value of $100
The price of your outstanding five-year bonds should be
(Round to the nearest cent)
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