Business
Business, 14.11.2019 18:31, azduce

Suppose you purchased a $1,000 face value, 15-year bond one year ago. the bond has a 7.125% (annual) coupon rate - but the bonds pay coupons semiannually. you paid $974.24 for the bond last year. however, yields have increased 1%. what is the price of the bond today?
i guess i'm confused about what the yields increasing one percent changes, but if you could just show me how to set it up that would be great!
it is multiple choice so the answers are below:
a) $991.33
b) $955.78
c) $896.14
d) $912.85
e) $917.28
f) $1,000

answer
Answers: 3

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Suppose you purchased a $1,000 face value, 15-year bond one year ago. the bond has a 7.125% (annual)...

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