Suppose a​ ten-year, $1,000 bond with an 8.3% coupon rate and semiannual coupons is trading for $1,035.77. a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)? b. If the​ bond's yield to maturity changes to 9.8% ​APR, what will be the​ bond's price?

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 8MC: Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for...
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Suppose a​ ten-year,
$1,000
bond with an
8.3%
coupon rate and semiannual coupons is trading for
$1,035.77.
a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)?
b. If the​ bond's yield to maturity changes to
9.8%
​APR, what will be the​ bond's price?
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