Question
A rupee-denominated 7% bond pays interest annually, and has three years remaining to maturity. It will be redeemed at par. The interest yield required by
A rupee-denominated 7% bond pays interest annually, and has three years remaining to
maturity. It will be redeemed at par.
The interest yield required by the bond investors is 4.5% per annum. An annual interest
payment has just been made.
Requirement:
Calculate the value of the bond.
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International Finance Theory and Policy
Authors: Paul R. Krugman, Maurice Obstfeld, Marc J. Melitz
10th edition
978-0133425895, 133425894, 978-0133423631, 133423638, 978-0133423648
