Question: fx B D E F G H K M N 1 Points Max: 10 Count present value of the bond with fixed cupon defined as

 fx B D E F G H K M N 1

fx B D E F G H K M N 1 Points Max: 10 Count present value of the bond with fixed cupon defined as a 10 % of the nominal bond value. Nominal value of the bond is equal to 2000 czk and it is mature in 4 years. Market interest rate (or yield of the bonds with the same risk level) equals to 13 %. A) Would you buy the bond for the 950 czk price now? B) How the value of the bond now would change if the maturity is 6 instead of 4 years under all other assumtions constant? 6 7 8 9 10

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