Question
The Salem Company bond currently sells for $848.55, has a coupon interest rate of 14% and a $1000 par value, pays interest annually, and has
The Salem Company bond currently sells for $848.55, has a coupon interest rate of 14% and a $1000 par value, pays interest annually, and has 16 years to maturity.
a. Calculate the yield to maturity (YTM) on this bond.
b. Explain the relationship that exists between the coupon interest rate and yield to maturity and the par value and market value of a bond.
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The Company Valuation Playbook Invest With Confidence
Authors: Charles Sunnucks
1st Edition
1838470816, 978-1838470814
