Thirty-year B-rated bonds of Parker Optical Company were initially issued at a 16 percent yield. After...

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Thirty-year B-rated bonds of Parker Optical Company were initially issued at a 16 percent yield. After 5 years the bonds have been upgraded to Aa2. Such bonds are currently yielding 14 percent to maturity. Use Table 16-2. Determine the price of the bonds with 25 years remaining to maturity. Price of the bonds ok t nt nces Table 16-2 Interest rates and bond prices (face value is $1,000 and annual 1 1 A coupon rate is 12%) B C D E F G H Rate in the Market (%) -Annual Yield to Maturity* 2 Years to Maturity 3 1 4 15 8% $1,037.72 $1,018.59 $1,153.72 10% 12% 14% $1,000.00 $981.92 $964.33 16% 5 25 $1,345.84 $1,429.64 $1,182.56 $1,000.00 $875.91 $774.84 $1,000.00 $861.99 $755.33 6 7 =+PV(F2/2,A5*2,-120/2,-1000) +PV(rate,nper.pmt,[fv]) Thirty-year B-rated bonds of Parker Optical Company were initially issued at a 16 percent yield. After 5 years the bonds have been upgraded to Aa2. Such bonds are currently yielding 14 percent to maturity. Use Table 16-2. Determine the price of the bonds with 25 years remaining to maturity. Price of the bonds ok t nt nces Table 16-2 Interest rates and bond prices (face value is $1,000 and annual 1 1 A coupon rate is 12%) B C D E F G H Rate in the Market (%) -Annual Yield to Maturity* 2 Years to Maturity 3 1 4 15 8% $1,037.72 $1,018.59 $1,153.72 10% 12% 14% $1,000.00 $981.92 $964.33 16% 5 25 $1,345.84 $1,429.64 $1,182.56 $1,000.00 $875.91 $774.84 $1,000.00 $861.99 $755.33 6 7 =+PV(F2/2,A5*2,-120/2,-1000) +PV(rate,nper.pmt,[fv])