A General Power bond carries a coupon rate of
9.3%
, has 9 years until maturity, and sells at a yield to maturity of
8.3%
. (Assume annual interest payments.) a. What interest payments do bondholders receive each year? b. At what price does the bond sell? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. c. What will happen to the bond price if the yield to maturity falls to
7.3%
? Note: Do not round intermediate calculations. Round your answer to
2
decimal places.

Question

A General Power bond carries a coupon rate of

9.3%

, has 9 years until maturity, and sells at a yield to maturity of

8.3%

. (Assume annual interest payments.) a. What interest payments do bondholders receive each year? b. At what price does the bond sell? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. c. What will happen to the bond price if the yield to maturity falls to

7.3%

? Note: Do not round intermediate calculations. Round your answer to

2

decimal places.

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