Question
SSS bonds have a 12-years maturity, $1,000 par value, and a 6.75% coupon paid quarterly, and those bonds sell at their par value. KKK bonds
SSS bonds have a 12-years maturity, $1,000 par value, and a 6.75% coupon paid quarterly, and those bonds sell at their par value.
KKK bonds have the same risk, maturity, and par value as SSS bonds, but the KKK bonds pay a 5.75% semi-annual coupons.
a/ What is the current price of the KKK bonds?
b/ What is the price of the KKK bonds 5 years from now?
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Bond Markets Analysis and Strategies
Authors: Frank J.Fabozzi
9th edition
133796779, 978-0133796773
