Question
Suppose a 15-year bond with $100 face value, 8.00% coupon rate and semiannual coupons is currently trading at par. All else constant, if the yield
Suppose a 15-year bond with $100 face value, 8.00% coupon rate and semiannual coupons is currently trading at par. All else constant, if the yield to maturity of the bond suddenly changes to 7.00% APR, what will happen to this bonds price?
Group of answer choices
it will decrease by $9.108
it will decrease by $8.745
it will increase by $9.196
it will stay the same
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Finance For Non Financial Managers
Authors: Pierre G. Bergeron
5th Edition
0176104070, 9780176104078
