The Shamrock Corporation has just issued a $1,000 par value zero-coupon bond with an 8 percent yield

Question:

The Shamrock has just issued a $1,000 zero-coupon bond with an 8 percent yield to maturity, due to mature 15 years from today (assume semiannual compounding).
a. What is the market price of the bond?
b. If interest rates remain constant, what will be the price of the bond in three years?
c. If interest rates rise to 10 percent, what will be the price of the bond in three years?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...