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Bond X is a premium bond making annual payments. The bond has a coupon rate of 8.2 percent, a YTM of 6.2 percent, and has 15 years to maturity. Bond Y is a discount bond making annual payments. This bond has a coupon rate of 6.2 percent, a YTM of 8.2 percent, and also has 15 years to maturity. Assume the interest rates remain unchanged.

1) What are the prices of these bonds today? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).)

2) What do you expect the prices of these bonds to be in one year? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g.,32.16).)

3) What do you expect the prices of these bonds to be in three years? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g.,32.16).)

4) What do you expect the prices of these bonds to be in eight years? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g.,32.16).)

5) What do you expect the prices of these bonds to be in 12 years? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).)

6) What do you expect the prices of these bonds to be in 15 years? (Do not round intermediate calculations.)

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M91778985

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