Question: need help solving Exactly five years ago The Storehouse Ltd borrowed $10,000,000 through a 10-year bond issue. The face value (and sale price) of each

 need help solving Exactly five years ago The Storehouse Ltd borrowed

need help solving

Exactly five years ago The Storehouse Ltd borrowed $10,000,000 through a 10-year bond issue. The face value (and sale price) of each bond was $1,000 and the coupon rate on each bond was 10% p.a. Interest on the bond is paid semi-annually. a. Calculate the amount of each interest payment on the bond. b. The current market price of each Storehouse Ltd bond is $1,200.00. What does this tell you about market interest rates? c. The current market price of each Storehouse Ltd bond is $1,200.00. Explain why someone would be willing to pay an extra $200 for a bond that states it is only "worth" $1,000. d. If I bought one of The Storehouse's bonds at a $100 premium a year ago and sold it today, what would be the approximate return on my investment? (You can ignore the time-value-of-money for this question)

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