Your company has raised financing by issuing 20-year bonds on January 1, 2010. They mature on...

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Your company has raised financing by issuing 20-year bonds on January 1, 2010. They mature on December 31, 2030 and have a par value of $1,000 and a coupon rate of 9%. Coupon payments are made semi-annually. a. What would the value of the bonds be on June 30, 2017, if interest rates had risen to 10%? b. What would be their value on December 31, 2023, if interest rates had fallen to 7%? c. If the bonds had a value of $975.00 on December 31, 2025, what would be their yield to maturity on that date? Your company has raised financing by issuing 20-year bonds on January 1, 2010. They mature on December 31, 2030 and have a par value of $1,000 and a coupon rate of 9%. Coupon payments are made semi-annually. a. What would the value of the bonds be on June 30, 2017, if interest rates had risen to 10%? b. What would be their value on December 31, 2023, if interest rates had fallen to 7%? c. If the bonds had a value of $975.00 on December 31, 2025, what would be their yield to maturity on that date?

Answer rating: 100% (QA)

Certainly Lets calculate the value of the bonds on June 30 2017 assuming interest rates have risen t... View the full answer