Value of the bonds

by | Sep 10, 2021 | Assignment Help

5 percentA. If the market yield is 7 percent, what are the values of the three first bonds (assume a face value of $1,000)?B. Why are the values of the bonds lower than their face value?C. Why is the coupon rate for the convertible bond lower than that for the non-convertible coupon issue? D. Given that the convertible bond is trading at $1,040, what is the value of the option to convert?E. Suppose that the market yield rises to 7.5 percent. What are the bond values at that yield?

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