Cheltenham College Ltd has just issued some corporate bonds that have a 10-year term to maturity. The face value per bond is $1,000; the coupon rate is 5% p.a., with coupons being paid annually. Assume that similar bonds trade at a market rate of interest (i.e. yield to maturity) of 6% p.a.

 The best estimate of the value of one of these bonds is?

Lisa has an opportunity to invest $25,000 today at a nominal interest rate of 6.5% per annum.Compounding half yearly. Is she wants this to grow to $50,000.

How long does she need to hold her investment?

Answer rating: 100% (QA)

As a teacher I can guide you on how to calculate the value of a bond In this case since the bond has ... View the full answer