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Atlantic Company issued a series of bonds on 1 January 2010. The bonds were sold at par ($1,000), have a 7%

coupon rate, and will mature on 31 December 2024. Interest payments are made semiannually on 30 June and 31 December.

a. What was the value of the bond on 1 January 2016, assuming that market interest rates had fallen to 5%?  Round your answer to two decimals.

b. On 1 January 2020, the bonds sold for $1,040. What was the yield to maturity on that date?  Express your answer in percent with two decimals.

please use the financial calculator

Top Answer

A. Bond price is $1,143.53 as on... View the full answer

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