What will be the price of the bond

Assignment Help Finance Basics

Reference no: EM132175452

Question - Consider three bonds with 6.40% coupon rates, all making annual coupon payments and all selling at face value. The short-term bond has a maturity of 4 years, the intermediate-term bond has a maturity of 8 years, and the long-term bond has a maturity of 30 years.

a. What will be the price of the 4-year bond if its yield increases to 7.40%?

b. What will be the price of the 8-year bond if its yield increases to 7.40%?

c. What will be the price of the 30-year bond if its yield increases to 7.40%?

Reference no: EM132175452

Questions Cloud

Persistence of gender inequality in contemporary culture : Begin by addressing the persistence of gender inequality in contemporary culture, by discussing some of the ways that women remain at a disadvantage in the work

Symbolic interactionists study : In Sociology, what exactly does Symbolic Interactionists study? Support your answer with relevant examples.

How far does the car go : The tires of a car make 60 revolutions as the car reduces its speed uniformly from 87.0km/h to 64.0km/h . The tires have a diameter of 0.90m . a= -1.8

Functions or essence of music in human culture : How can we best describe the roles, functions or essence of Music in human culture at a given society in the context of the statement

What will be the price of the bond : Consider three bonds with 6.40% coupon rates, all making annual coupon payments and all selling at face value. What will be the price of the 4-year bond

Determining the modern forms of sexism in sociology : When determining the modern forms of sexism in Sociology, what is the difference between Traditional Sexism and Modern Sexism?

Have you ever read something that you suspected was fake new : Do you think power and oppression should be a part of our definition of racism, and why do you feel that way?

Why did the undocumented population in the us grow : Why did the undocumented population in the US grow a lot during the 1990s and early 2000s, according to Roberto G. Gonzales?

Calculate the moment of inertia for the sheet : A thin, rectangular sheet of metal has mass M and sides of length a and b. Use the parallelaxis theorem to calculate the moment of inertia for the sheet.

User Account

All Pages