Suppose the coupon rate is 10% issue at par $1000 and for 15 years. Let say the market interest rate decreased to 5% after the bond was issued a) What is the interest payment for this bond annually b) What is the interest payment on semi-annually c) How much should the investors pay for this bondi.e. the value
Suppose the coupon rate is 10% issue at par $1000 and for 15 years. Let say the market interest rate decreased to 5% after the bond was issued a) What is the interest payment for this bond annually b) What is the interest payment on semi-annually c) How much should the investors pay for this bondi.e. the value
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 11P
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Suppose the coupon rate is 10% issue at par $1000 and for 15 years. Let say the market interest rate decreased to 5% after the bond was issued
a) What is the interest payment for this bond annually
b) What is the interest payment on semi-annually
c) How much should the investors pay for this bondi.e. the value
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