A Bond par value sh. 100 coupon rate 7% investment period 10 years a) Determine the value of the bonds. Assume an interest rate of 15% b) If the rates increase by 1%, what is the bond elasticity? c) If the rates decrease by 2%, what Is the bond elasticity? Kindly use PVIFA table . Thank you.

A Bond par value sh. 100 coupon rate 7% investment period 10 years a) Determine the value of the bonds. Assume an interest rate of 15% b) If the rates increase by 1%, what is the bond elasticity? c) If the rates decrease by 2%, what Is the bond elasticity? Kindly use PVIFA table . Thank you.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter6: Bonds (debt) - Characteristics And Valuation

Section: Chapter Questions

Problem 17PROB

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A Bond par value sh. 100 coupon rate 7% investment period 10 years

a) Determine the value of the bonds. Assume an interest rate of 15%

b) If the rates increase by 1%, what is the bond elasticity?

c) If the rates decrease by 2%, what Is the bond elasticity?

Kindly use PVIFA table . Thank you.

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