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A $1000 8% bond matures at par on Sept. 1, 2015. The coupon dates are September 1 and March 1. The bond has a call
A $1000 8% bond matures at par on Sept. 1, 2015. The coupon dates are September 1 and March 1. The bond has a call provision on March 1, 2008 of 104, meaning that on the call date the bondholder would receive 104% of par, i.e. $1040 if the bond is called on that date. (The coupon would be payable on that date in addition to $1040.) Find the value of this bond on March 1, 2004, such that it yields a nominal rate of 10% convertible semiannually if
a. The bond is redeemed at par on 9/1/15
b. The bond is called on 3/1/08
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