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Suppose a seven - year, $ 1 comma 0 0 0 bond with a coupon rate of 7 . 6 % and semiannual coupons is
Suppose a sevenyear, $ comma bond with a coupon rate of and semiannual coupons is trading with a yield to maturity of a Is this bond currently trading at a discount, at par, or at a premium? Explain. b If the yield to maturity of the bond rises to APR with semiannual compounding what price will the bond trade for? Question content area bottom Part a Is this bond currently trading at a discount, at par, or at a premium? Explain.Select the best choice below. A Because the yield to maturity is less than the coupon rate, the bond is trading at a premium. B Because the yield to maturity is less than the coupon rate, the bond is trading at a discount. C Because the yield to maturity is greater than the coupon rate, the bond is trading at a premium. D Because the yield to maturity is greater than the coupon rate, the bond is trading at par. Part b If the yield to maturity of the bond rises to APR with semiannual compounding what price will the bond trade for? The new price of the bond is $ enter your response here. Round to the nearest cent.
Suppose a sevenyear, $ comma bond with a coupon rate of and semiannual coupons is trading with a yield to maturity of
a Is this bond currently trading at a discount, at par, or at a premium? Explain.
b If the yield to maturity of the bond rises to APR with semiannual compounding what price will the bond trade for?
Question content area bottom
Part
a Is this bond currently trading at a discount, at par, or at a premium? Explain.Select the best choice below.
A
Because the yield to maturity is less than the coupon rate, the bond is trading at a premium.
B
Because the yield to maturity is less than the coupon rate, the bond is trading at a discount.
C
Because the yield to maturity is greater than the coupon rate, the bond is trading at a premium.
D
Because the yield to maturity is greater than the coupon rate, the bond is trading at par.
Part
b If the yield to maturity of the bond rises to APR with semiannual compounding what price will the bond trade for?
The new price of the bond is $
enter your response here. Round to the nearest cent.
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