Question
There are two bonds in the market, Bond X and Bond Y. Both of them have a face value of $4000, and annual coupon of
There are two bonds in the market, Bond X and Bond Y. Both of them have a face value of $4000, and annual coupon of $400. However, Bond X takes 3 years to maturity and Bond Y take 4 years to maturity.
Suppose YTM is 8%, what are the bond prices? Which bond has a higher interest rate risk?
please show work
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Global Business Today
Authors: Charles Hill
7th Edition
0078137217, 9780078137211
