A. you offered to buy a 4 year coupon corporate bond in the beginning of its 7th monthon its third year for $963.94. its face value is $1,000 and its coupon rate is 5.172% per annum, with coupon paid at the end of each quarter. Government bond rate now is 6.9%. a. is $963.94 a good price for you to buy it or not ? what is the fair price for the bond ? b. what is the yield if you buy at the price that you been offered ? c. if the government bond rate suddenly goes down to 4.7% what will be the new fair value of the bond ?
A. you offered to buy a 4 year coupon corporate bond in the beginning of its 7th monthon its third year for $963.94. its face value is $1,000 and its coupon rate is 5.172% per annum, with coupon paid at the end of each quarter. Government bond rate now is 6.9%.
a. is $963.94 a good price for you to buy it or not ? what is the fair price for the bond ?
b. what is the yield if you buy at the price that you been offered ?
c. if the government bond rate suddenly goes down to 4.7% what will be the new fair
B. the company just paid a $1.48 annual dividend and announced the plan to pay $1.54 next year . the
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