Bond x is a premium bond making semi annual payments the


Bond X is a premium bond making semi annual payments. The bond pays a 9% coupon, YTM of 7% and has 13 years to maturity. Bond Y is a discount bond making semi annual payments. This bond has a 7% coupon, YTM of 9% and 13 years to maturity.

A) What is the dollar price of each bond?

If interest rates remain unchanged, what do you expect the price of these bonds to be

B) 1 year from now?

C) 3 years?

D) 8 years?

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Financial Management: Bond x is a premium bond making semi annual payments the
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