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27. Brathead bond has a 4% coupon rate. Settlement date is 6/15/2023. Maturity date is 6/15/2033 The bond pays semi-annual interest. The new bond is
27. Brathead bond has a 4% coupon rate. Settlement date is 6/15/2023. Maturity date is 6/15/2033 The bond pays semi-annual interest. The new bond is rated AA by Standard \& Poors. At settlemen date, the U.S. 10-year treasury note yields 4% and bond spreads are +20 basis points (0.2%) for A rated bonds, +40bps for AA and +60bps for A rated issues. The yield to maturity is % and the bond price is (dollar terms). 28. A global financial crisis causes investors to buy treasuries for safety, and the U.S. 10-year rises in price, resulting in a new yield to maturity of 3.6%. Brathead is considered a safe bond and thus also rises in price, but the spread for A bonds increase to 60 bps. What is the new yield to maturity % and bond price versus treasuries. What is the new yield to maturity % and bond price
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