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Homework answers / question archive / Spartans outstanding bonds have a $1,000 par value and they mature in 20 years
Spartans outstanding bonds have a $1,000 par value and they mature in 20 years. Their nominal yield to maturity is 9% and they pay interest semiannually. The bond sell at a price of $975.
a) What is the bond's coupon rate?
b) Next year the same bond with the coupon rate that you calculated in part a is selling for a nominal yield to maturitty of 8.50%.What is the price of that bond next year?
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