There are six coupon bonds that have the same coupon rate of 10%, the same face...

 

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There are six coupon bonds that have the same coupon rate of 10%, the same face value of $1000, and the same initial price (which is the current purchasing price} of $1,000. All bonds pay coupon annually. However, their terms to maturity are different. (13.1). When interest rates rise from 10% to 30% in the next year, please fill out the blanks in the following table. Please note that "Rate of Return" represents one-year rate of return. Initial Yield (%) Maturity Rate of Initial Price Rate of Capital Gain (%) Price Next Year ($) Return (%) ($) 1,000 1,000 1,000 1,000 1,000 1,000 10% 1070 10% 10% 30 10 333.66 337.89 396.20 566.75a 46.15 20 10 66 -434 10 10 10 10 1 10 (13.2) When interest rates rise from 10% to 30% after 5 years, please fill out the blanks in the following table. Please note that "Rate of Return" represents one-year rate of return. Initial Price Price Next Year ($) Rate of Capital Gain (%) Rate of Return (%) Maturity Initial Yield (%) ($) 1,000 1,000 1,000 1,000 1,000 1,000 30 10 20 10 10 10 10 10 1 10 There are six coupon bonds that have the same coupon rate of 10%, the same face value of $1000, and the same initial price (which is the current purchasing price} of $1,000. All bonds pay coupon annually. However, their terms to maturity are different. (13.1). When interest rates rise from 10% to 30% in the next year, please fill out the blanks in the following table. Please note that "Rate of Return" represents one-year rate of return. Initial Yield (%) Maturity Rate of Initial Price Rate of Capital Gain (%) Price Next Year ($) Return (%) ($) 1,000 1,000 1,000 1,000 1,000 1,000 10% 1070 10% 10% 30 10 333.66 337.89 396.20 566.75a 46.15 20 10 66 -434 10 10 10 10 1 10 (13.2) When interest rates rise from 10% to 30% after 5 years, please fill out the blanks in the following table. Please note that "Rate of Return" represents one-year rate of return. Initial Price Price Next Year ($) Rate of Capital Gain (%) Rate of Return (%) Maturity Initial Yield (%) ($) 1,000 1,000 1,000 1,000 1,000 1,000 30 10 20 10 10 10 10 10 1 10

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Assume the interest rate increases after the first coupon is paid and the remaining period is ... View the full answer