Question
1. A 25 year bond, has a coupon rate of 12% and semi annual coupon payments. The required nominal yield on the bond is 10%.
1. A 25 year bond, has a coupon rate of 12% and semi annual coupon payments. The required nominal yield on the bond is 10%. Assume that the yield curve is downward sloping and the yield is expected to decline to 8%. a. What would be the value of the bond now? b. What should be the value of the bond in 7 years?
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Bond Markets Analysis And Strategies
Authors: Frank J. Fabozzi
6th Edition
0131986430, 9780131986435
