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Could anyone solve these for me? Also, for the first one, how do you know when to use coupon rate vs required return? Thanks! Chapter

Could anyone solve these for me? Also, for the first one, how do you know when to use coupon rate vs required return? Thanks! image text in transcribed
Chapter 3 interest rate and security valuation BOND PRICING WITH SEMI ANNUAL COUPONS Coupon rate Face value Required return (APR) Required return/period Number of years to maturity 6.00% 1000 6.50% 3.25% Bond price using PV function Interest rate risk - effect of coupon Bond A has 9% annual coupon, current yield is 7%, par 1000, 5 year maturity, Bond B has 6% annual coupon, current yield is 7%, par 1000, 5 year maturity, . Compute bond price (intrinsic value) a. b. Bond A Bond B - ll. Suppose the market rate increases by 0.5%, compute the new bond price a. Bond A b. Bond B- IlI. percentage change in price a. Bond A_ b. Bond B

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