What will be the price of bond trade


Discuss the below:

Q: Suppose a seven-year, $1000 bond with an 8% coupon rate and semiannual coupons is trading with a yield to maturity of 6.75%.

a. Is this bond currently trading at a discount, at par, or at a premium? Explain.

b. If the yield to maturity of the bond rises to 7% (APR with semiannual compounding), what price will the bond trade for?

Request for Solution File

Ask an Expert for Answer!!
Operation Management: What will be the price of bond trade
Reference No:- TGS02064902

Expected delivery within 24 Hours