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Interest rates are equal to 6% for every maturity. A 3-year bond with face value $800 offers an annual coupon rate of 8%. A 2-year
Interest rates are equal to 6% for every maturity. A 3-year bond with face value $800 offers an annual coupon rate of 8%. A 2-year bond with an annual coupon $60 sells at par.
What is the price of the 3-year coupon bond?
a. $789
b. $1010.7
c. $725.4
d. $842.8
e. $1053.5
f. $885.5
g. $800
h. $935.8
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