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please answer b,c,d. (Bond vatuation) You are examining three bonds with a par value of $1,000 (you receive $1,000 at maturity) and are concerned with

please answer b,c,d. image text in transcribed
(Bond vatuation) You are examining three bonds with a par value of $1,000 (you receive $1,000 at maturity) and are concerned with what would happen to their market value if intorest rates for the market. discount rate) changed. The rree bonds are Bond Aa bond wth 5 years left to maturity that has an annual coupon interest rate of 11 percent, but the interost is paid semiannualy? Bond B-a bond With 12 years left to maturity that has an annuat coupon intevest rato of 11 percent, but the interest is paid somiannualy. Bond Ca bond with 18 years left to matirny that has an annual coupon interest rate of 11 percent, but the interest is paid semiannually. What would be the value of these bonds if the matkot discount rate were a. 11 percent per year compounded semianuaby? b. 5 percent per year compounded semiannually? c. 16 percent per year compounded semiannually? d. What observations can you make about these tesults? a. If the maket discount rate were 11 percent per year compounded semiannualy, the value of Bond A is 1 (Round to the nearest centt) If the markot dscount rato were 11 percont per year compounded semiannually, the value of Bond B is 5 . (Round to the nearest cent) If the maket dscount rate were 11 percent por year compoundod semiannually, the value of 80ndC is $1000. (ound to the nearest cent) b. If the market discount rate were 5 percent per year compounded semiantualy, the value of Bond A is 51,26256 . (Round to the nearest cent) If the market dincount rato were 5 porceet per year compounded semiannually, the value of Bond 8 is 4 (Rhound to the nearest cent.)

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