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(Questions 18-33) LO2 18. Bond Price Movements Bond X is a premium bond making semiannual payments. The bond has a coupon rate of 7.5 percent,
(Questions 18-33) LO2 18. Bond Price Movements Bond X is a premium bond making semiannual payments. The bond has a coupon rate of 7.5 percent, a x YTM of 6 percent, and 13 years to maturity. Bond Y is a discount bond making semiannual payments. This bond has a coupon rate of 6 percent, a YTM of 7.5 percent, and also 13 years to maturity. What are the prices of these bonds today assuming both bonds have a $1,000 par value? If interest rates remain unchanged, what do you expect the prices of these bonds to be in 1 year In 3 years? In 8 years? In 12 years? In 13 years? What's going on here? Illustrate your answers by graphing bond prices versus time to maturity malo romiannual payments and are priced at par
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