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this is all tbe info tnat came with the question (Bond valuation relationships) Stanley, Inc. issues 15-year $1,000 bonds that pay $85 annually. The market
this is all tbe info tnat came with the question
(Bond valuation relationships) Stanley, Inc. issues 15-year $1,000 bonds that pay $85 annually. The market price for the bonds is $960. The market's required yield to maturity on a comparable-risk bond is 9 percent. a. What is the value of the bond to you? b. What happens to the value if the market's required yield to maturity on a comparable-risk bond (1) increases to 11 percent or (ii) decreases to 7 percent? c. Under which of the circumstances in part b should you purchase the bond? a. What is the value of the bond if the market's required yield to maturity on a comparable-risk bond is 9 percent? (Round to the nearest cont.) b. () What is the value of the bond if the market's required yield to maturity on a comparable-riak bond increases to 11 percent? (Round to the nearest cont.) b. (1) What is the value of the bond if the market's required yield to maturity on a comparable-riok bond decreases to 7 percent? (Round to the nearest cent) c. Under which of the circumstances in part should you purchase the bond? (Select from the drop-down menun.) If the yield to maturity on a comparable-risk bond purchase the Stanley bonds at the current market price of $960 you Enter your answer in each of the answer boxes Step by Step Solution
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