In: Finance
You want to buy a $2000 corporate bond maturing in 3 years with
a coupon rate of 9%. The current market rate is of 7%. Answer the
following questions:
1) How much is the bond going to cost you today?
2) Will the coupon rate change if the market rate rises to
8%?
3) What will the price be of the bond if market rate is 6%?