General Matter’s outstanding bond issue has a coupon rate of 10.4%, and it sells at a yield to maturity of 8.50%. The firm wishes to issue additional bonds to the public. What coupon rate must the new bonds offer in order to sell at face value? Note: Enter your answer as a percent rounded to 2 decimal places.
General Matter’s outstanding bond issue has a coupon rate of 10.4%, and it sells at a yield to maturity of 8.50%. The firm wishes to issue additional bonds to the public. What coupon rate must the new bonds offer in order to sell at face value? Note: Enter your answer as a percent rounded to 2 decimal places.
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
Problem 16P
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General Matter’s outstanding bond issue has a coupon rate of 10.4%, and it sells at a yield to maturity of 8.50%. The firm wishes to issue additional bonds to the public. What coupon rate must the new bonds offer in order to sell at face value? Note: Enter your answer as a percent rounded to 2 decimal places.
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