Consider a bond with the following characteristics. Par: $1,000 Two coupon payments per year (i.e.,...
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Consider a bond with the following characteristics. Par: $1,000 Two coupon payments per year (i.e., coupons are paid semi-annually) Coupon rate: 4.00% Years to maturity: 8 Bond price: $1,000 Suppose that the annual market interest rate for this bond drops by 1%. What is the new bond price? Note: recall that the annual yield-to-maturity (YTM) is the market interest rate on the bond. $1,070.66 $1,000.00 $934.72
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