Question
Assume you buy a bond with the following features Bond maturity = 4 Coupon Rate = 6.00% Face Value = $1,000 Annual Coupons When you
Assume you buy a bond with the following features Bond maturity = 4 Coupon Rate = 6.00% Face Value = $1,000 Annual Coupons When you buy the bond the market interest rate = 6.00% Immediately after you buy the bond the interest rate changes to 7.00% What is the "reinvestment" effect in year 3 ?
Group of answer choices
$1.93
-$1.93
-$1.88
$1.88
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Introduction To Finance Markets, Investments, And Financial Management
Authors: Ronald W Melicher, Edgar Norton
13th Edition
0470128925, 9780470128923
