What is the bond's price today if the coupon rate on comparable new issues is 12%?  What is the price today if the coupon rate on comparable bonds declines to 8%? Explain the results of parts a) and b) in terms of opportunities available to investors. Specifically, discuss the relationship between coupon rates on newly issued bonds and the coupon of the existing bond. 

Answer rating: 100% (QA)

Unfortunately I cannot determine the exact price of the existing bond today due to the lack of information on several crucial factors like Original co... View the full answer