Corporate bond-what is the yield to maturity

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A. A corporate bond A maturing in 30 years has a 7% coupon rate. It is selling at a face value ($1,000). What is the yield to maturity?

B. A similar corporate bond B maturing in 30 years has a 3% coupon rate. At what price should this bond sell if the yield to maturity is the same for both bonds?

C. Because of sudden changes in the risk of these bonds, the required rate of return goes up to 9%. What is the price of these bonds now? (for bonds A, B)

D. what are the percentage changes in each price?

Reference no: EM131853592

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