Mike firm has credit rating

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Reference no: EM131862558

Mike's firm has a credit rating of A. He notices that the credit spread for five?-year maturity A debt is 91 basis points (0.91%). His ?firm's five?-year debt has a coupon rate of 4%. He sees that new five?-year Government of Canada bonds are being issued with a YTM of 2?%. What should the price of his outstanding five?-year bonds? be? Assume a ?$100 par value and that the bonds pay? semi-annual coupons.

Reference no: EM131862558

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