1 a 6 semiannual coupon bond matures in 4 years the bond, Ask an Expert

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1. A 6% semiannual coupon bond matures in 4 years. The bond has a face value of $1,000 and a current yield of 6.5814%.

A. What is the bond's price? Round your answer to the nearest cent. $

B. What is the bond's YTM? (Hint: Refer to Footnote 7 for the definition of the current yield and to Table 7.1.) Round your answers to two decimal places. %

2. You are considering a 15-year, $1,000 par value bond. Its coupon rate is 9%, and interest is paid semiannually. If you require an "effective" annual interest rate (not a nominal rate) of 8.24%, how much should you be willing to pay for the bond? Do not round intermediate steps. Round your answer to the nearest cent. $

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92709281

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