Fixed-term mortgage or adjustable rate mortgage

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1. Grossnickle Corporation issued 20-year, noncallable, 8.5% semi-annual coupon bonds at their par value of $1000 five years ago. Today, the market interest rate on these bonds is 5.5%. What is the current price of the bonds? (use a financial calculator, please show the step)

2. If you are in the market for a home loan, what will you prefer: a fixed-term mortgage or an adjustable rate mortgage? Also, what would be your ideal term of home loan- 15 years or 30 years?

Reference no: EM131871692

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