Question
Consider a bond (with par value = $1,000) paying a coupon rate of 7% per year semiannually when the market interest rate is only 5%
Consider a bond (with par value = $1,000) paying a coupon rate of 7% per year semiannually when the market interest rate is only 5% per half-year. The bond has 3 years until maturity.
a. Find the bond's price today and 6 months from now after the next coupon is paid. (Round your answers to 2 decimal places.
Current price ? Price after six months?
b. What is the total (6-month) rate of return on the bond?
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Handbook Of Global Financial Markets
Authors: Sabri Boubaker, Duc Khuong Nguyen
1st Edition
9813236647, 978-9813236646
