Homework answers / question archive / ?(Bond valuation? relationships) The 19?-year, ?$1,000 par value bonds of Waco Industries pay 12 percent interest annually

?(Bond valuation? relationships) The 19?-year, ?$1,000 par value bonds of Waco Industries pay 12 percent interest annually

Finance

Share With

?(Bond valuation? relationships) The 19?-year, ?$1,000 par value bonds of Waco Industries pay 12 percent interest annually. The market price of the bond is ?$1,145?, and the? market's required yield to maturity on a? comparable-risk bond is 9 percent.

a.  What is your yield to maturity on the Waco bonds given the current market price of the? bonds? (%, Round to two decimal places)

b.  Determine the value of the bond to you given the? market's required yield to maturity on a? comparable-risk bond. ($, EX. 102.25)

c.  Should you purchase the? bond?