Question
Suppose that General Motors Acceptance Corporation issued a bond with 10 years until maturity, a face value of $1,000, and a coupon rate of 7.1%
Suppose that General Motors Acceptance Corporation issued a bond with 10 years until maturity, a face value of $1,000, and a coupon rate of 7.1% (annual payments). The yield to maturity on this bond when it was issued was 5.9%. Assuming the yield to maturity remains constant, what is the price of the bond immediately before it makes its first coupon payment?
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Business Forecasting
Authors: John E. Hanke, Dean Wichern
9th edition
132301202, 978-0132301206
