$10$: Chapter $13$ EOC problems

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Problem $13-01$

A $$1,000$ bond has a coupon of $7$ percent and matures after twelve years. Assume that the bond pays interest annually.

a$.$ What would be the bond's price if comparable debt yields $10$ percent? Use Appendix B and Appendix D to answer the question. Round your answer to the nearest dollar:

$ dollar.

$

c$.$ Why are the prices different in a and $b?$

d$.$ What are the current yields and the yields to maturity in a and $b?$ Round your answers to two decimal places.

The bond matures after twelve years:

$CY$: $\%$

$YTM$:

The bond matures after six years:

$CY$: $\%$

$YTM$: $\%$

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