Answers to Text Discussion Questions

14. An investor places $800,000 in 30-year bonds (12 percent coupon rate), and interest rates decline by 3 percent. Use Table 12–4 to determine the current value of the portfolio. 12-14. Use of bond table. 15. Use Table 12–4 to describe the worst possible scenario for a $1,000 bond based on yield change, years to maturity, and coupon rate. ................
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