Question
Suppose there are bonds = 263 million Exchange rate = $1.5575 Bonds worth = 263 x 1.5575 = $409.6225 Therefore bonds are worth = 409.6225
Suppose there are bonds = £263 million
Exchange rate = $1.5575
Bonds worth = 263 x 1.5575 = $409.6225
Therefore bonds are worth = 409.6225
Based on the calculation on the above, what is the premium (discount) of this bond compared to the par value? Is this premium similar to the premium that is observed in the market today of a little over 11%? If there is a difference, why is that so?
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Answer 1 The premium discount of this bond is calculated by subtracting the bonds market price fro...
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Microeconomics An Intuitive Approach with Calculus
Authors: Thomas Nechyba
1st edition
538453257, 978-0538453257
