Question
1) Calculate the price of a $1,000 face value 10 yr, 4% coupon bond with annual payments if investments of similar quality are yielding 5.2%?
1) Calculate the price of a $1,000 face value 10 yr, 4% coupon bond with annual payments if investments of similar quality are yielding 5.2%? Is this bond selling at a discount, premium, or par value?
2) Calculate the price of a $1,000 face value 10 yr, 4% coupon bond with semi-annual payments if investments of similar quality are yielding 5.2%. Is this bond selling at a discount, premium, or par value?
3) Do you notice a difference? Why?
4) Calculate the price of a $1,000 face value 12 yr, 6% coupon bond with semi-annual payments if investments of similar quality are yielding 5.2%. Is this bond selling at a discount, premium, or par value?
Need 2,3, and 4
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