Question
A GM and a Ford bond both have 4 years to maturity, a $1,000 par value, a BB rating and pay interest semiannually. GM has
A GM and a Ford bond both have 4 years to maturity, a $1,000 par value, a BB rating and pay interest semiannually. GM has a coupon rate of 6.1%, while Ford has a coupon rate of 5.4%.
1. The GM bond trades at 87.4 (percent of par). What is the yield to maturity (YTM)?
2. What should be the price of the Ford bond (in $)?
BankMart Inc. recently issued bonds that mature in 9 years. They have a par value of $1,000 and an annual coupon of 3%. The current market interest rate is 10%.
1. What is the bond's value?
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Financial Literacy For Young Adults Simplified Discover How To Manage Save And Invest Money To Build A Secure And Independent Future
Authors: Raman Keane
1st Edition
8399806501, 979-8399806501
