Harrimon Industries bonds have 5 years left to maturity. Interest is paid annually, and the bonds...

 

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Harrimon Industries bonds have 5 years left to maturity. Interest is paid annually, and the bonds have a $1,000 par value and a coupon rate of 10%. a. What is the yield to maturity at a current market price of 1. $842? Round your answer to two decimal places. % 2. $1,157? Round your answer to two decimal places. % b. Would you pay $842 for each bond if you thought that a "fair" market interest rate for such bonds was 14%-that is, if ra = 14%? Harrimon Industries bonds have 5 years left to maturity. Interest is paid annually, and the bonds have a $1,000 par value and a coupon rate of 10%. a. What is the yield to maturity at a current market price of 1. $842? Round your answer to two decimal places. % 2. $1,157? Round your answer to two decimal places. % b. Would you pay $842 for each bond if you thought that a "fair" market interest rate for such bonds was 14%-that is, if ra = 14%?

Answer rating: 100% (QA)

a 1 842bond Annual coupon 100 Coupon for remaining 5 years 100 5 500 Par value 1000 Total ... View the full answer