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Refer to Table 10-1, which is based on bonds paying 10 percent interest for 20 years. Assume interest rates in the market (yield to maturity)
Refer to Table 10-1, which is based on bonds paying 10 percent interest for 20 years. Assume interest rates in the market (yield to maturity) increase from 9 to 12 percent. (a) What is the bond price at 9 percent? (Round "PV Factor" to 3 decimal places, intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Bond price $ (b) What is the bond price at 12 percent? (Round "PV Factor" to 3 decimal places, intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Bond price $ (c) What would be your percentage return on the investment if you bought when rates were 9 percent and sold when rates were 12 percent? (Enter the value as positive value. Round "PV Factor" to 3 decimal places, intermediate calculations and final answers to 2 decimal places.Omit the "%" sign in your response.) on investment % profit? or loss
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