What coupon rate do you need to set

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1. Suppose a ten-year, $1,000 bond with an 8.4 coupon rate and semiannual coupons is trading for $1,034.18. a. What is the bond's yield to maturity (expressed as an APR with semiannual? compounding) b. If the bond's yield to maturity changes to 9.6 % APR, what will be the bond's price?

2. Your company currently has $1,000 par, 6.25 % coupon bonds with 10 years to maturity and a price of $1,066. If you want to issue new? 10-year coupon bonds at par, what coupon rate do you need to set? Assume that for both bonds, the next coupon payment is due in exactly six months.

Reference no: EM131897558

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