Exhibit 12.2 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) XLR Corporation just issued a $1,000 par value b...
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Exhibit 12.2 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) XLR Corporation just issued a $1,000 par value bond with a 7 percent yield to maturity, twenty years to maturity, with an 8 percent semi-annual coupon rate. |
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37. Refer to Exhibit 12.2. If market interest rates rise to 10 percent, what will the price of the XLR Corporate bond be in three years?
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Homework Answers
The price of the bond is calculated using the PV function:-
=PV(rate,nper,pmt,fv)
=PV(10%/2,17*2,8%/2*1000,1000)
=838.07
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