Question
3. a. (10 pts) You have a two year bond that has a market yield of 10% and a coupon rate of 10%. What is
3. a. (10 pts) You have a two year bond that has a market yield of 10% and a coupon rate of 10%. What is the price of this bond?
b. (10 points) Now market rates drop to 8%, What is the price of this bond?
c. (10 pts) What is the current yield from part b?
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Financial Management Principles And Applications
Authors: J William Petty, Sheridan Titman, Arthur J Keown, John D Martin, Peter Martin, Michael Burrow, Hoa Nguyen
6th Edition
1442539178, 9781442539174
