Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. you find a bond with 21 years until maturity that

You find a bond with 21 years until maturity that has a coupon rate of...

80.2K

Verified Solution

Question

Accounting

image
You find a bond with 21 years until maturity that has a coupon rate of 6.0 percent and a yleld to maturity of 5.2 percent. Suppose the yield to maturity on the bond increases by .25 percent. a. What is the new price of the bond using duration and using the bond pricing formula? (Do not round intermediate calculations. Round your answers to 2 decimal ploces.) b. Now suppose the original yleld to maturity is increased by 1 percent. What is the new price of the bond? (Do not round intermediote colculotions. Round your answers to 2 decimal places.)

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students