Rosa Co. issued 2000, 15 year bonds with a face value of $1,000 each on 1st October 2012. The coupon rate was 9% and the required rate of return at the time of issue was 10%. An original investor decided to sell his five bonds on 1st April, 2015. Current new issue bonds are offering a coupon rate of 12%, and the required rate of return is 11%. If calculating the resale value of the bonds: (a) State the value for P/Y,C/Y, and briefly explain why this value was chosen. (a) State the relevant coupon interest rate, and briefly explain why this value was chosen (b) State the relevant value for N, and briefly explain why this value was chosen
Rosa Co. issued 2000, 15 year bonds with a face value of $1,000 each on 1st October 2012. The coupon rate was 9% and the required
If calculating the resale value of the bonds:
(a) State the value for P/Y,C/Y, and briefly explain why this value was chosen.
(a) State the relevant coupon interest rate, and briefly explain why this value was chosen
(b) State the relevant value for N, and briefly explain why this value was chosen
(c) State the relevant discount rate, and briefly explain why this value was chosen
(d) Calculate the amount of interest that would be received each year.
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