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a) Life and living it company limited issued a bond with a face value of C1000 and fifteen (15) years to maturity from now.
a) Life and living it company limited issued a bond with a face value of C1000 and fifteen (15) years to maturity from now. Given 12% rate as the yield to maturity, you are required to determine the following: i) What is the price of the bond today, if it pays no coupons? (2marks) ii) What is the price of the bond if it pays annual coupons of 9 %? (3 marks) in) What is the price today if pays 14% coupon rate semi-annually? (3 marks)
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Answer Solution 9 face value 9 P b 1000 T E Then ityst C0 P F R annual 1000 101235 Coupoun94 ...
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Investment Analysis and Portfolio Management
Authors: Frank K. Reilly, Keith C. Brown
10th Edition
538482109, 1133711774, 538482389, 9780538482103, 9781133711773, 978-0538482387
