Financial Management

John's company has taken advantage of the prevailing low interest rate environment to raise new financing, It issued bonds on Jenuary 1, 2008, which msture on December 31, 2030 and have a par value of $1,000 and a coupon rate of 6%. Coupon payments are made semi-annually. (i) What would the value of the bonds be on June 30,2018 , if interest rates had risen to 12%? ( 9 marks) (ii) What would be their value on Decenber 31,2022 , if interest rates had fallen to 4% ? ( 9 marks) (iii) If the bonds had a value of $945.00 on June 30,2025 , what would be their yieid to maturity on that date? (7 marks) John's company has taken advantage of the prevailing low interest rate environment to raise new financing, It issued bonds on Jenuary 1, 2008, which msture on December 31, 2030 and have a par value of $1,000 and a coupon rate of 6%. Coupon payments are made semi-annually. (i) What would the value of the bonds be on June 30,2018 , if interest rates had risen to 12%? ( 9 marks) (ii) What would be their value on Decenber 31,2022 , if interest rates had fallen to 4% ? ( 9 marks) (iii) If the bonds had a value of $945.00 on June 30,2025 , what would be their yieid to maturity on that date? (7 marks)