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3. (25pts) You plan to raise an additional $100,000 to purchase this building by selling bonds. You issue a hundred $1,000 par value bonds maturing
3. (25pts) You plan to raise an additional $100,000 to purchase this building by selling bonds. You issue a hundred $1,000 par value bonds maturing in 10 years at a coupon rate of 6% with semiannual coupon payments. The yield to maturity (YTM) on these bonds is 6% compounded semiannually when they are issued. What is the value of a bond at issue? What is the value of a bond in 6 years if the YTM increases to 10% compounded semiannually? Explain why bond prices change as the YTM changes over time. How do changes in a bond's rating affect this math
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