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please answer question 5 4. Consider a bond paying a coupon rate of 8% per year annually when the market interest rate is 6% per
please answer question 5
4. Consider a bond paying a coupon rate of 8% per year annually when the market interest rate is 6% per year. The bond has six years until maturity and its par value is $1000. What are the bond's price today (PO), its price 1 year from now after the next coupon is paid (PI), and its holding period return (t) over the 1-year period? Assume market interest rate stays the same after 1 year. 5. Answer question 4 if the market interest rate drops to 5% after 1 yearStep by Step Solution
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