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Suppose Ford Motor Company issues a five year bond with a face value of $5,000 that pays an annual coupon payment of $150. What is
Suppose Ford Motor Company issues a five year bond with a face value of $5,000 that pays an annual coupon payment of $150.
- What is the interest rate Ford is paying on the borrowed funds?
- Suppose the market interest rate rises from 3% to 4% a year after Ford issues the bonds. Will the value of the bond increase or decrease?
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Macroeconomics
Authors: Andrew B. Abel, Ben S. Bernanke, Dean Croushore, Ronald D. Kneebone
8th Canadian Edition
134646355, 9780134842615 , 978-0134646350
