Suppose a 5 coupon, 5 year bond is selling for $1100 The coupon is paid every six months The principal value is $1000 (1) Calculate the yield to maturity of this bond (7 marks) (Hint Use the Yield function in Excel ) (2) Calculate the price of this bond if the yield to maturity increases by 1 with ...

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Suppose a 5% coupon, 5-year bond is selling for $1100. The coupon is paid every six months.

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Suppose a 5% coupon, 5-year bond is selling for $1100. The coupon is paid every six months. The principal value is $1000.
(1) Calculate the yield to maturity of this bond. (7 marks). (Hint: Use the Yield function in Excel.)
(2) Calculate the price of this bond if the yield to maturity increases by 1% with maturity unchanged. (7 marks).
(3) Calculate the price of this bond if the yield to maturity decreases by 1% with maturity unchanged. (6 marks).

Posted Date: Jul 11, 2024 10:03 PM

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Suppose a 5% coupon, 5-year bond is selling for $1100. The coupon is paid every six months.

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