a. How would the present value (and therefore the market value) of a bond be affected if

Question:

a. How would the present value (and therefore the market value) of a bond be affected if the payments are smaller and other factors remain constant?
b. How would the present value (and therefore the market value) of a bond be affected if the required rate of return is smaller and other factors remain constant?
Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a...