6year 8 coupon bond with semi annual payments par value


6 year, 8% coupon bond with semi annual payments, Par Value = $1000.

1) Find out price of the bond if YTM = 10%.

2) What happens to the bond price if YTM decreases 1 basis point?

3) Is the effect of 1 basis point decrease on a 20 year old coupon bond larger, = or smaller than that in 2)?

Solution Preview :

Prepared by a verified Expert
Basic Statistics: 6year 8 coupon bond with semi annual payments par value
Reference No:- TGS02925032

Now Priced at $15 (50% Discount)

Recommended (90%)

Rated (4.3/5)