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Question #2 in front of You 3 investment opportunities in bonds as follow: Bond A B Par value 2000 5000 8000 Coupon rate 9% 11%
Question #2 in front of You 3 investment opportunities in bonds as follow: Bond A B Par value 2000 5000 8000 Coupon rate 9% 11% 6% Years to maturity 8 12 15 Market rate 15% 8% 6% Market price 1350 6500 8100 Answer the next questions showing the steps of solving (writing only the answers are not acceptable): 1- Find the intrinsic value for the three bonds? 2- Which bond is best investment from your own opinion and why? 3- After 5 years from now assuming that the market rate remain as is, and the market price remain as is too, recalculate the intrinsic value for the three bonds
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