In: Finance
Assume all bonds pay interest semiannually.
2. Calculate the market price of a $1,000 face value bond under the following conditions.
Coupon Time Until Current
Rate Maturity Discount Rate
a. 12% 15 yrs 10%
b. 7% 5 yrs 12%
c. 9% 25 yrs 6%
d. 14%. 30 yrs 9%
e. 5% 6 yrs. 8%
3. What is the current yield on each of the bonds in the previous
problem.