Your company currently has 5.75% coupon-rate bonds (coupons are paid semi-annually) with ten years to maturity...

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Your company currently has 5.75% coupon-rate bonds (coupons are paid semi-annually) with ten years to maturity and a price of $1067. If you want to issue new 10-year coupon bonds at par, what coupon rate do you need to set? (Assume that for both bonds, the next coupon payment is due in exactly 6 months.) You need to set a coupon rate of %. (Round to two decimal places.) Your company currently has 5.75% coupon-rate bonds (coupons are paid semi-annually) with ten years to maturity and a price of $1067. If you want to issue new 10-year coupon bonds at par, what coupon rate do you need to set? (Assume that for both bonds, the next coupon payment is due in exactly 6 months.) You need to set a coupon rate of %. (Round to two decimal places.)

Answer rating: 100% (QA)

Solution To determine the coupon rate for the new bonds we need to ensure that the present value of ... View the full answer