If interest rates in the overall economy drop to 8 percent, which of the following is...
Homework Answers
We are not given no of years, so we have to use basic bond principle to answer the question
If YTM < coupon rate , bond will trade at a premium.
Here YTM = 8%, which is lower than coupon rate of 10%, so bond will trade at a premium.
So possible price = 1200
Answer : 1200 [Thumbs up please]
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If
interest rates in the overall economy drop to 8 percent, which of
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