Coupon payments Archives

What would happen to the value of the bond if the inflation rate unexpectedly goes up?

Posted on April 30, 2021 by Essay-Help

Suppose you buy a bond that will pay $1000 in ten years along with an annual coupon payment of $50 and the interest rate is 4%. Answer the following questions: What is the value of this bond? Now suppose the bond has no coupon payments but still pays $1000 in ten years. What is the […]

What is the coupon rate if coupon payments are $20 per year? At what discount rate would the value of the bond be “at par” (e.g., be worth $1,000?). Explain your reasoning.

Posted on February 9, 2021 by Essay-Help

Compute the future value for the following: $2,000 after being invested for two years in a savings account with 3% interest rate $5,000 after being invested for ten years in a savings account with a 1% interest rate $3,500 after being invested for nine years in a savings account with an 11% interest rate Compute […]

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What would happen to the value of the bond if the inflation rate unexpectedly goes up?

What is the coupon rate if coupon payments are $20 per year? At what discount rate would the value of the bond be “at par” (e.g., be worth $1,000?). Explain your reasoning.