A 27-year U

Accounting Sep 14, 2020

A 27-year U.S. Treasury bond with a face value of $1,000 pays a coupon of 6.00% (3.000% of face value every six months). The reported yield to maturity is 5.6% (a six-month discount rate of 5.6/2 = 2.8%). (Do not round intermediate calculations. Round your answers to 2 decimal places.)

a. What is the present value of the bond?

Present value $

b. If the yield to maturity changes to 1%, what will be the present value?

Present value $

c. If the yield to maturity changes to 8%, what will be the present value?

Present value $

d. If the yield to maturity changes to 15%, what will be the present value?

Present value

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