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Posted on May 19, 2024

Suppose a 1 0 - year, $ 1 , 0 0 0 bond with a coupon rate of 8 . 7 % and semiannual coupons

Suppose a

10 -

year, $

1, 000

bond with a coupon rate of

8.7 %

and semiannual coupons is trading for $

1, 034.28

.

What is the bond's yield to maturity

(

expressed as an APR with semiannual compounding

) ?

.

If the bond's yield to maturity changes to

9.9 %

APRwhat will be the bond's price?

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