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ABC Phones is interested in investing some of its pettycashinelevenyearDEFWireless bondswhichhasP1,000face value,annualcouponrateof8%andyieldtomaturity of12%. Whatisthevalueofthebonduponitsissuance? Whatisthevalueofthebondonthe11thyear? If YTM increases to 14%, but the ABC Phones does

ABC Phones is interested in investing some of its pettycashinelevenyearDEFWireless bondswhichhasP1,000face value,annualcouponrateof8%andyieldtomaturity of12%.

  1. Whatisthevalueofthebonduponitsissuance?
  2. Whatisthevalueofthebondonthe11thyear?
  3. If YTM increases to 14%, but the ABC Phones does notintend to return the bonds to the market, what is the expected rate ofreturn?

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