Perform instant experiments on whether changing various inputs causes an increase or decrease in the Bond Price
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Perform instant experiments on whether changing various inputs causes an increase or decrease in the Bond Price and by how much.
(a.) What happens when the annual coupon rate is increased?
(b.) What happens when the yield to maturity is increased?
(c.) What happens when the number of payments / year is increased?
(d.) What happens when the face value is increased?
(e.) What is the relationship between the price of a par bond and time to maturity?
(f.) What happens when the annual coupon rate is increased to the point that it equals the yield to maturity? What happens when it is increased further?
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