Bond A makes semiannual payments and is currently trading at par. The bond pays a coupon rate
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Bond A makes semiannual payments and is currently trading at par. The bond pays a coupon rate of 8.6 percent and has 5 years to maturity. Bond B also makes semiannual payments and is currently trading at par. The bond pays a coupon rate of 8.6 percent and has 15 years to maturity.
Calculate the price of both bonds if interest rates fall by 2% and increase by 2% as well as the current price at par.
Related Book For
Introduction to Operations Research
ISBN: 978-1259162985
10th edition
Authors: Frederick S. Hillier, Gerald J. Lieberman
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