Question: 8:40 l UE Reader View Available Class Activity #2 1. Suppose you buy a 7% coupon, 20 year bond today when it's first issued. If

 8:40 l UE Reader View Available Class Activity #2 1. Suppose

8:40 l UE Reader View Available Class Activity #2 1. Suppose you buy a 7% coupon, 20 year bond today when it's first issued. If interest rates suddenly rise to 15%, what happens to the value of your bond? Why? 2. Malahat Inc. has 7.5% coupon bonds on the market that have ten years left to maturity. The bonds make annual payments. If the YTM on these bonds is 8.75%, what is the current bond price? 3. Happy Valley Corporation has bonds on the market with 14.5 years to maturity, a YTM of 6.1% and c urgent price of $1,038. The bonds make semiannual payments. What must the coupon rate be on these bonds? 4. What is the relationship between the price of a bond and its YTM? 5. Colwood corporation has *% coupon bonds making annual payments with a YTM of 7.2%, current market value of 1.059.6. How many years do these bonds have left until they mature

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