An AAA-rated corporate bond has a face value of $1,000 and a credit spread of 4%. The bond has 10 years to maturity and pays coupons semi-annually at a rate of 6% per annum. If the current risk-free treasury yield is 0.95% per annum, what is the value of the bond closest to? $1,801 $756 $1,200 $1,08

An AAA-rated corporate bond has a face value of $1,000 and a credit spread of 4%. The bond has 10 years to maturity and pays coupons semi-annually at a rate of 6% per annum. If the current risk-free treasury yield is 0.95% per annum, what is the value of the bond closest to? $1,801 $756 $1,200 $1,08

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter14: Investing In Stocks And Bonds

Section: Chapter Questions

Problem 6DTM

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