Question
Does anyone can help me 2 questions. thanks 1.A government bond with a face value of $500,000 was issued eight years ago and there are
Does anyone can help me 2 questions. thanks
1.A government bond with a face value of $500,000 was issued eight years ago and there are seven years remaining until maturity.The bond pays semi-annual coupon payments of $22,500, the coupon rate is 9% p.a. paid twice yearly and rates in the marketplace are 8% pa compounded semi-annually.What is the value of the bond today?
2. On 4 September 2012 a company issued a bond with a face value of $500,000 that matures exactly 20 years later.The coupon rate is 7% p.a. compounded half-yearly.What is the bond's value on 4 September 2018 assuming the market yield is 4% p.a. compounded half-yearly
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