If a company has $500,000,000 in semi-annual bonds outstanding with 7.5% coupon and 12 years to maturity remaining, what is the market value of the bonds if the yield to maturity is 6.25%?
| K = Nx2 |
| Bond Price =∑ [(Semi Annual Coupon)/(1 + YTM/2)^k] + Par value/(1 + YTM/2)^Nx2 |
| k=1 |
| K =12x2 |
| Bond Price =∑ [(7.5*500000000/200)/(1 + 6.25/200)^k] + 500000000/(1 + 6.25/200)^12x2 |
| k=1 |
| Bond Price = 552217934.14 |
If a company has $500,000,000 in semi-annual bonds outstanding with 7.5% coupon and 12 years to...
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