Question
3. You have just noticed in the financial pages of the lcoal newspaper that you can buy a $1,000-par bond for $800. The coupon rate
3. You have just noticed in the financial pages of the lcoal newspaper that you can buy a $1,000-par bond for $800. The coupon rate is 6% and there are 10 years to maturity. Interest is paid semi-annually.
A- If the going rate of interest is 8%, what is the value of the bond?
B- Should you make the purchase? Why?
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Measuring And Managing Credit Risk Quantitative Approach For Default Risk Data Analysis And Models For Loss Distributions Unique Strategies For Back Capital Allocation And Saucerization
Authors: Arnaud De Servigny , Olivier Renault
1st Edition
0071417559,007178800X
