An investor owns a $2;000 par-value 12% bond with semiannual coupons. The bound will mature at par at the end of fourteen years. The investor decides that a ten-year bond would be preferable. Current yield rates are 6% convertible semiannually. The investor uses the proceeds from the sale of the 12% bond to purchase a 8% bond with semiannual coupons, maturing at par at the end of ten years. 

Find the face value of the 8% bond.

Answer rating: 100% (QA)

Heres the solution to find the face value of the 8 bond 1 Calculate the semiannual coupon payment of ... View the full answer