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Reindeer Plc. has invested in 8,000 AA-rated 5% 3-year semi-annual coupon corporate bonds, which have a face value of 100. Reindeer has also been informed
Reindeer Plc. has invested in 8,000 AA-rated 5% 3-year semi-annual coupon corporate bonds, which have a face value of 100. Reindeer has also been informed by its broker that AA-rated 3-year Austrian government bonds offer a yield of 3% p.a and are currently trading at par.
Calculate the Intrinsic value of the corporate bonds?
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