Please check my answers to this problem. 1,000 par value bond, semi annual payments, 4% annual interest,
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Question:
Please check my answers to this problem.
1,000 par value bond, semi annual payments, 4% annual interest, 16 years to maturity, current yield to maturity on similar bonds is 10%
question a) what is the current price of the bonds?
Answer: $728.45
question b) By what percent will the price of the bonds increase between now and maturity?
answer: 4.01%
question c) what is the annual compound rate of growth in the value of the bonds?
answer: 2.00%
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