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What is the bond current value

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Problem - Eight years ago, Over-the-Top Trampolines issued a 15-year bond with a $1,000 par value and a 6 percent coupon rate (interest is paid annually).

Today the going rate of interest on similar bonds is 6 percent.

(a) What is the bond's current value? If the market rate stays at 6 percent for the remainder of the bond's life?

(b) What the current yield?

(c) What the capital gains yield will bondholders receive during the next two years (i.e., Years 9 and 10)?

Reference no: EM132697403

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