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Assuming the face value of TOL's bond is $1,000, determine the current price of this bond. TOL'S bond is a 25-year bond issued 23 years
Assuming the face value of TOL's bond is $1,000, determine the current price of this bond. TOL'S bond is a 25-year bond issued 23 years ago with a coupon of 8% maturing in 2 years and as of today is rated BBB-. It was rated BBB+ 23 years ago at issuance. 6-Month 5-Year 30-Year 2.30% 2.50% 3.00% 1-Year 7-Year 2.35% 2.70% 3 yr 5 yr 50 36 42 Resent Treasury Yields: 3-Month 2.20% 2-Year 2.40% 10-Year 2.80% Current Corporate Spreads: Rating 1 Yr 2 yr AAA 35 AA+ 41 48 42 52 AA- 44 A+ 42 68 A 66 72 A- 70 76 BBB+ 82 85 BBB 98 92 BBB- 150 165 49 62 56 56 60 70 75 80 88 95 170 66 70 75 77 84 99 104 190 7 Yr 68 76 80 82 90 92 95 128 135 195 10 Yr 82 91 96 98 101 103 104 150 158 210 30 Yr 102 112 114 120 125 127 130 177 184 270 Assuming the face value of TOL's bond is $1,000, determine the current price of this bond. TOL'S bond is a 25-year bond issued 23 years ago with a coupon of 8% maturing in 2 years and as of today is rated BBB-. It was rated BBB+ 23 years ago at issuance. 6-Month 5-Year 30-Year 2.30% 2.50% 3.00% 1-Year 7-Year 2.35% 2.70% 3 yr 5 yr 50 36 42 Resent Treasury Yields: 3-Month 2.20% 2-Year 2.40% 10-Year 2.80% Current Corporate Spreads: Rating 1 Yr 2 yr AAA 35 AA+ 41 48 42 52 AA- 44 A+ 42 68 A 66 72 A- 70 76 BBB+ 82 85 BBB 98 92 BBB- 150 165 49 62 56 56 60 70 75 80 88 95 170 66 70 75 77 84 99 104 190 7 Yr 68 76 80 82 90 92 95 128 135 195 10 Yr 82 91 96 98 101 103 104 150 158 210 30 Yr 102 112 114 120 125 127 130 177 184 270
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