Which is based on bonds paying 10 percent interest for 20 years. Assume interest rates in the market (yield to maturity) decline from 11 percent to 8 percent: (assume the standard bond par value as the future value)
a) What is the bond price at 11 percent?
b) What is the bond price at 8 percent?
c) What would be your percentage return on investment if you bought when rates were 11 percent and sold when rates were 8 percent sales price?