Question
Your broker faxed to you the following information about two quarterly coupon bonds that you are considering as a potential investment. Unfortunately, your fax machine
Your broker faxed to you the following information about two quarterly coupon bonds that you are considering as a potential investment.
Unfortunately, your fax machine is blurring some of the items, and all you can read from the fax on the two different bonds is the following:
Features | IBM Coupon Bond | AOL Coupon Bond |
Face value | $5,000 | $1,000 |
Coupon rate | 8.5% | ? |
Yield to maturity | 7.5% | 5.5% |
Years to maturity | 30 | 15 |
Price | ? | $1,457.61 |
Fill in the missing data from the information that the broker sent.
Part 1 What is the price of the IBM coupon bond? $enter your response here(Round to the nearest cent.)
Part 2 What is the coupon rate of the AOL coupon bond? enter your response here% (Round to the nearest whole percent.)
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