As you browse opportunities for investment you come across


It is early 2008. As you browse opportunities for investment, you come across Horsham Industries, which has some bonds on issue and which pays its coupon every six months. Based on this online information, answer the following questions. Issuer name Coupon Maturity Rating Moody’s High Low Last Change Yield % Horsham Industries 5.550% Mar 2037 Aa3 96.124 95.933 96.124 –0.245 5.825 1. What is the YTM for this Horsham Industries company bond? 2. What is the coupon yield of this bond over the next year? 3. If your required rate of return for a bond of this risk-class is 6.2 %, what value do you place on this Horsham Industries bond? 4. At the required rate of return of 6.2 % are you interested in purchasing this bond? 5. If you purchased this Horsham Industries bond for $961.24 yesterday and the market rate of interest for this bond increased to 6.0 % today, do you have a gain or loss? How much is that gain or loss in dollars?

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Financial Management: As you browse opportunities for investment you come across
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