Business, 06.03.2020 21:38 ChHal1958

Three $1,000 face value, 10-year, noncallable, bonds have the same amount of risk, hence their YTMs are equal. Bond 8 has an 8% annual coupon, Bond 10 has a 10% annual coupon, and Bond 12 has a 12% annual coupon. Bond 10 sells at par. Assuming that interest rates remain constant for the next 10 years, which of the following statements is CORRECT?

(A) Since the bonds have the same YTM, they should all have the same price, and since interest rates are not expected to change, their prices should all remain at their current levels until maturity
(B) Bond 8 sells at a discount (its price is less than par), and its price is expected to increase over the next year.
(C) Over the next year, Bond 8's price is expected to decrease, Bond 10's price is expected to stay the same, and Bond 12's price is expected to increase.
(D) Bond 12 sells at a premium (its price is greater than par), and its price is expected to increase over the next year.
(E) Bond 8's current yield will increase each year.

Answers: 1

Show answers

Another question on Business

Business, 21.06.2019 16:00

Danny "dimes" donahue is a neighborhood's 9-year-old entrepreneur. his most recent venture is selling homemade brownies that he bakes himself. at a price of $2 each, he sells 100. at a price of $1.5 each, he sells 300. instructions: round your answer to 1 decimal place. a. what is the elasticity of demand? 3.50 â± 0.1 . b. is demand elastic or inelastic over this price range? . c. if demand had the same elasticity for a price decline from $1.5 to $1 as it does for the decline from $2 to $1.5, would cutting the price from $1.5 to $1 increase or decrease danny's total revenue? .

Answers: 1

Answer

Business, 22.06.2019 02:00

Corporations with suppliers, vendors, and customers all over the globe are referred to as : a) global corporations b) international corporations c) multinational corporations d) multicultural corporations

Answers: 2

Answer

Business, 22.06.2019 04:40

Who has summer school : ( because i do : (

Answers: 1

Answer

Business, 22.06.2019 05:00

At which stage would you introduce your product to the market at large? a. development stage b. market testing stage c. commercialization stage d. ideation stage

Answers: 3

Answer

You know the right answer?

Three $1,000 face value, 10-year, noncallable, bonds have the same amount of risk, hence their YTMs...

Questions