Question
1a) what is the value of 10 Year K1000 par value bond with a 10% annual coupon, paid semi annually, if its required return is10%
1a) what is the value of 10 Year K1000 par value bond with a 10% annual coupon, paid semi annually, if its required return is 10%
b) what is the value of a 13% coupon bond that is otherwise identical to the bond described in part c above? would we now have a discount or a premium?
c) what is the value of a 7% coupon with these characteristics ? would we now have a discount or premium bond?
d) what would happen to the 7%, 10% and 13% coupon bonds overtime if the required has increased to 13%
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Intermediate Financial Management
Authors: Eugene F. Brigham, Phillip R. Daves
12th edition
1285850033, 978-1305480698, 1305480694, 978-0357688236, 978-1285850030
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