Determine the market price of bond


A 2 year bond with 1000 face value and 10% coupon rate is sold for 1000 today. if one year later the market interest rate increases by 5%, then this bond will have a market price of?

now supposes:

a three year bond with 1000 face value and 10% coupon rate is sold for 1000 today. if one year later the market interest rate increases by 5%, then this bond will have a market price of ?

now if that buyer instead bought a 2 year bond with 1000 face value and 10% coupon rate for 1000 today. if one year later the market interest rate increases by 5% and they sell the bond, this his rate of return on this investment is ?

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Microeconomics: Determine the market price of bond
Reference No:- TGS073333

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