Answers to Text Discussion Questions - Seattle University

12-17. a) The new bond price is $1,195.10 (Table 12-3 for 10 periods with a 12 percent coupon rate and a 9 percent yield to maturity) Original bond price $1,000.00. Increase in value $ 195.10. Investment (25% margin) = 25% × $1000 = $250. b) New bond price $894.10 (Table 12-3 for 10 periods with a 12 percent coupon rate and a 14 percent yield ... ................
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