A. What would a bond with a $2,000,000 Face value, a 9% rate and 15 years to maturity sell for today if the current market rate (YTM) is 8.5% (semi-annual)? Assume the bond pays interest every six months.
B. If an investor bought the bond in part (A) and now sells it after holding it for six years (they have just received an interest payment) and the market rate is now 9.25% (semi), what would it have sold for and what would they have earned (%) on the bond?