A 12-year bond has an 8 percent annual coupon and a face value of $1,000.
The bond has a yield to maturity of 7 percent.
What is the price of the annual coupon bond today?
a. $ 924.64
b. $1,000.00
c. $1,070.24
d. $1,079.43
e. $1,099.21
Answer: D
If the yield to maturity remains at 7 percent, what will be the price of the bond three years from today?
a. $ 937.53
b. $ 963.94
c. $1,026.24
d. $1,052.68
e. $1,065.15
Answer: E
If the answers is incorrect or not given, you can answer the above question in the comment box. If the answers is incorrect or not given, you can answer the above question in the comment box.