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could anyone help me to solve these problems for #26, the interest rate is 10% 22A6 percent, annual coupon bond is currently selling at a
could anyone help me to solve these problems
for #26, the interest rate is 10%
22A6 percent, annual coupon bond is currently selling at a premium and matures in 7 years. The boad was originally issued 3 years ago at par. Which one of the following is accurate in respect to this bond today? A. The face value of the bond today is greater than it was when the bond was issued. B. The bond is worth less today than when it was issued. C. The yield-to-maturity is greater than the coupon rate The coupon rate is greater than the yield to maturity. E. The yield-to-maturity equals the coupon rate. Consider a bond which pays 7% semi-annually and has 8 years to maturity. The market requires an interest rate of 8% on bonds of this risk. What is the price of the bond? 23 Assume that you wish to purchase a 20-year bond that has a maturity value of $1,000 and makes semiannual interest payments of$40. If you require a 10% return on this investment, what is the maximum price you will be willing to pay for the bond? 24. The current market price of Smith Corporation's bonds is $1,297.58. A 10% coupon interest rate is paid semiannually, and the par value is equal to $1,000. What is the YTM (yield to maturity) if the bonds mature 10 years from today? 25. You took a loan of $20,000 and will pay back in 8 years with equal annual payments at year-end. A. 26. How much is the annual payment? B. What is the ending balance after 6 payments? C. In the 5t payment, how much is the interest and how much is the princiStep by Step Solution
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