Question
Pybus, Inc. is considering issuing bonds that will mature in 18 years with an annual coupon rate of 9 percent. Their par value will be
Pybus, Inc. is considering issuing bonds that will mature in 18 years with an annual coupon rate of 9 percent. Their par value will be $1,000, and the interest will be paid semiannually. Pybus is hoping to get a AA rating on its bonds and, if it does, the yield to maturity on similar AA bonds is 8.5 percent. However, Pybus is not sure whether the new bonds will receive a AA rating. If they receive an A rating, the yield to maturity on similar A bonds is 9.5 percent. What will be the price of these bonds if they receive either an A or a AA rating?
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Passive Income Ideas 2020 $10 000 Per Month Ultimate Guide
Authors: Roberts Ronald
1st Edition
1951595793, 978-1951595791
