A corporate bond has 30 years left to maturity, a par value of $1,000, coupon rate of 7.5% with semi-annual payment, and yield to maturity (YTM) of 3.33%. Let’s assume that in 5 years, the YTM on this increases to 5.51%. What will the $price be for this bond in 5 years?

A corporate bond has 30 years left to maturity, a par value of $1,000, coupon rate of 7.5% with semi-annual payment, and yield to maturity (YTM) of 3.33%. Let’s assume that in 5 years, the YTM on this increases to 5.51%. What will the $price be for this bond in 5 years?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 4MC

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