Question
A 2-year bond pays a coupon of $20 every 6 months and its par value is $1,000. The bond's yield is 6% with continuous compounding.
A 2-year bond pays a coupon of $20 every 6 months and its par value is $1,000. The bond's yield is 6% with continuous compounding.
1. What is the bond's market price?
2. What is the bond's maturity?
3. How would the bond's market price change if its yield increases by 1 basis points?
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Financial Management
Authors: Rob Quail, Ricardo J. Rodriguez
2nd Edition
1557868441, 9781557868442
