A company has 15-year bonds with a $5000 maturity value and a quoted coupon rate of 15% paid semiannually. The current yield is 10% compounded semiannually. (Round your answers to the nearest cent.) (a) Compute the price of these bonds. $ 5000 (b) Suppose that with 8 years remaining until maturity, the yield rate drops to 9% compounded semiannually. Find the new price of these bonds. $ 3629.24
A company has 15-year bonds with a $5000 maturity value and a quoted coupon rate of 15% paid semiannually. The current yield is 10% compounded semiannually. (Round your answers to the nearest cent.) (a) Compute the price of these bonds. $ 5000 (b) Suppose that with 8 years remaining until maturity, the yield rate drops to 9% compounded semiannually. Find the new price of these bonds. $ 3629.24
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
Problem 17P
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