Question: Next three question has the same data. Mrs. Geeta is a risk averse investor. She regularly invests in Bonds/FDs/RDs. Recently she has been told about
Next three question has the same data. Mrs. Geeta is a risk averse investor. She regularly invests in Bonds/FDs/RDs. Recently she has been told about the bonds which are 8% Coupon Bonds. These bonds are issued at face value but will be redeemable at a premium of 5%. Interest is paid annually and tenor of the bond would be 10 years. 1. Calculate YTM of bonds on the issue date.
Same data as the above question.2. Assume bonds are being traded at Rs. 106 after 3 years. Calculate YTM at this point
3.Same data as above questions. Three years after the issue, when the price of a Bond was at 106, RBI announced something and interest rates went up by 75 basis points. Calculate the revised price of bond.
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