Question
You buy an 8% coupon bond. It matures in 5 years and pays annual coupons. When you buy the bond, the market interest rate is
You buy an 8% coupon bond. It matures in 5 years and pays annual coupons. When you buy the bond, the market interest rate is 8%. You decide to sell the bond 1-year later, when the market interest rate is 7%. What is the price of the bond when you decide to sell it (ending price)?
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Intermediate Financial Management
Authors: Eugene F. Brigham, Phillip R. Daves
8th Edition
0324258917, 9780324258912
