You find a bond with 29 years until maturity that has a coupon rate of 9.5 percent and a yield to maturity of 8.9 percent. Suppose the yield to maturity on the bond increases by 0.25 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 places.) b. Now suppose the original yield to maturity is increased by 1 percent. What is the new price of the bond? (Do not round intermediate calculations. Round your answers to 2 decimal places.)
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “You find a bond with 29 years until maturity that has a coupon rate of 9.5 percent and a yield to maturity of 8.9 percent. Suppose the ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Preferred stockholders:a. must receive more dividends per share than the common stockholders. b. must receive dividends every year. c. have the right to receive dividends only in the years the board of directors declares dividends. d.
Answers (1)
Which of the following contributes to the lag in implementing fiscal policy? It takes time for Congress and the president to pass spending and tax changes. Current economic data takes time to collect and analyze.
Answers (1)
Steve and Grace know that their nephew loves to travel. Steve and Grace find a great deal on a timeshare and tell Mike they are negotiating to buy the timeshare to give to Mike as a wedding gift.
Answers (1)
Which document is used by a seller to describe the condition of his property to the buyer?
Answers (1)
When Toyota owners began to report problems with sticking accelerator pedals and non functioning brakes, Toyota at first ignored or rejected the claims. Eventually, the company evaluated the issue and issued a recall.
Answers (1)
New Questions in Business
Linda underpaid her taxes for the current year by $4,000 due to negligence. a. Calculate Linda's accuracy-related penalty for negligence. $ b.
Answers (1)
A retired person with $200,000 to invest states that "current income" is her main investment objective. Which of the following would be most suitable? (A) High yield bonds and growth stocks (B) Municipal bonds, U. S.
Answers (1)
How do compliments and substitutes affect demand?
Answers (1)
Non-trade receivables should be reported separately from trade receivables. Why is this statement either true or false? A) It is true because trade receivables are current assets and non-trade receivables are long term.
Answers (1)
In general, a visionary organization asks what three types of questions to specify its foundation, set a direction, and formulate strategies? why, when, where what, by whom, how why, what, how how, when, where who, why, when
Answers (1)