Question
A bond has a par value of $1,000, a time to maturity of 25 years, a coupon rate of 8% with interest paid annually, a
A bond has a par value of $1,000, a time to maturity of 25 years, a coupon rate of 8% with interest paid annually, a current price of $870, and a yield to maturity of 9.36%. Intuitively and without using calculations, if interest payments are reinvested at 7%, the realized compound yield on this bond must be?
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Fixed Income Markets And Their Derivatives
Authors: Suresh Sundaresan
3rd Edition
0123850517, 978-0123704719
