(a) You are buying a 30-year bond with a coupon rate of 6%, paid semiannually, a...
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(a) You are buying a 30-year bond with a coupon rate of 6%, paid semiannually, a face value of $1000 at an interest rate of 8% level. What is your buying price? (b) 3 years after you bought the bond at-la), the interest rate drops to 7% and you decided to sell the bond. What is the price you can sell it then? (c) What is the compounded annual rate of return of this bond investment for year? (Show all your work to get any credit) (a) You are buying a 30-year bond with a coupon rate of 6%, paid semiannually, a face value of $1000 at an interest rate of 8% level. What is your buying price? (b) 3 years after you bought the bond at-la), the interest rate drops to 7% and you decided to sell the bond. What is the price you can sell it then? (c) What is the compounded annual rate of return of this bond investment for year? (Show all your work to get any credit)
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1 You are buying a 30year bond with a 6 coupon rate paid semiannually every 6 months face value of 1... View the full answer
Related Book For
Microeconomics Theory and Applications with Calculus
ISBN: 978-0133019933
3rd edition
Authors: Jeffrey M. Perloff
Posted Date:
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