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20. The SRD Company has bonds outstanding with a par value of $10,000,000 that reaches maturity in 15 years. The bond certificate indicates that the
20. The SRD Company has bonds outstanding with a par value of $10,000,000 that reaches maturity in 15 years. The bond certificate indicates that the stated coupon rate for this bond is 8% and that the coupon payments are to be made semi-annually. a) How much will each semi-annual coupon payment in dollars ($) be? b) Assuming the appropriate Yield to Maturity (YTM or market rate) on the SRD bond is 7.5%, what should be the value of these bonds? c) Assuming that this bond trades for $918.556 per unit, then what is its YTM? d) Continuing from part (c) above. Assume that the market interest rate remains the same (i.e. does not change through the year), at that price should this bond be traded for (per unit) one year from today? (Use 3-decimal places for your answer)
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