Question
Fingen's 11 -year, $ 1, 000 par value bonds pay 8 percent interest annually. The market price of the bonds is $ 1,050 and themarket's
Fingen's 11-year, $1, 000 par value bonds pay 8 percent interest annually. The market price of the bonds is $1,050 and themarket's required yield to maturity on acomparable-risk bond is 9 percent.
a.Compute thebond's yield to maturity.
b.Determine the value of the bond toyou, given your required rate of return.
c.Should you purchase thebond?
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Personal Financial Planning
Authors: Randy Billingsley, Lawrence J. Gitman, Michael D. Joehnk
14th edition
978-1305887725, 1305887727, 1305636619, 978-1305636613
