What happens to the value of the bond-why

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Reference no: EM13917665

Your company issued a 10% coupon rate bond with face valueof $1000. The bond pays interest rate semiannually, and the bond has 20-year to maturity.

a) If required interest rate on bond is 8%, what is the bond's value?

b) If required rate suddenly rise to 15% what happens to the value of the bond? Why?

Reference no: EM13917665

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