Consider a bond with a coupon rate of 4%, a YTM of 6%, and a...
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Accounting
Consider a bond with a coupon rate of 4%, a YTM of 6%, and a face value of $1000. Coupon payments are made annually.
a. If this bond matures in 15 years, what are you willing to pay for it today? What are you willing to pay for it in 6 years?
b. If the bond matures in 30 years, what are you willing to pay for it today? What are you willing to pay for it in 10 years?
c. What is happening to the value of this bond over time?
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