Bond valuation callaghan motors bonds have 10 years


(A) BOND VALUATION Callaghan Motors' bonds have 10 years remaining to maturity. Interest is paid semiannually, they have a $1,000 par value, the coupon interest rate is 8%, and the yield to maturity is 9%. What is the bond's current market price?

(B) FUTURE PRICE A bond has a $1,000 par value, 10 years to maturity, and a 7% semiannual coupon and sells for $985. Assume that the yield to maturity remains at 7.21% for the next 3 years. What will the price be 3 years from today?

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Financial Management: Bond valuation callaghan motors bonds have 10 years
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