The price of a bond issued by C & M plc is 85.50 per cent of par

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The price of a bond issued by C & M plc is 85.50 per cent of par value. The bond will pay an annual 8.5 per cent coupon until maturity (the next coupon will be paid in one year). The bond matures in seven years.

(a) What will be the market price of the bond if yields to maturity for this risk class fall to 7.5 per cent?

(b) What will be the market price of the bond if yields to maturity for this risk class rise to 18 percent?

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Modern Financial Markets And Institutions

ISBN: 9780273730354

1st Edition

Authors: Glen Arnold

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Question Posted: May 18, 2024 11:06 PM

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The price of a bond issued by C & M plc is 85.50 per cent of par

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Modern Financial Markets And Institutions

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