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A company issues a? ten-year bond at par with a coupon rate of 6.7?% paid? semi-annually....

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Finance

A company issues a? ten-year bond at par with a coupon rate of6.7?% paid? semi-annually. The YTM at the beginning of the thirdyear of the bond? (8 years left to? maturity) is 9.3?%. What is thenew price of the? bond?

A. $ 1,198

B. $ 856

C. $ 1,027

D. ?$1,000

Answer & Explanation Solved by verified expert
4.2 Ratings (604 Votes)
New Price of the Bond The Price of the Bond is the Present Value of the Coupon Payments plus the Present Value of the Face ValuePar Value The Price of the    See Answer
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Transcribed Image Text

A company issues a? ten-year bond at par with a coupon rate of6.7?% paid? semi-annually. The YTM at the beginning of the thirdyear of the bond? (8 years left to? maturity) is 9.3?%. What is thenew price of the? bond?A. $ 1,198B. $ 856C. $ 1,027D. ?$1,000

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