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Mr. Dileep is a conservative investor. He is considering any one of the two bonds for investment and has ascertained the following information in relation
Mr. Dileep is a conservative investor. He is considering any one of the two bonds for investment and has ascertained the following information in relation to them. As an advisor help him finalizing as to which bond should he choose keeping in mind the intrinsic value assuming a required rate of 14% per annum and Yield to Maturity. Bond Coupon Rate Maturity Price per Rs 1000 par value Bond A 12% 9 years 890 B 11% 7 years 720 You may use the approximation formula for calculating YTM. Show all your calculations and decision bases clearly
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