Anonymous asked in Business & FinancePersonal Finance · 8 years ago

Finance Question. Can't figure it out. Please help.?

A $1000 bond with a coupon rate of 5.4% paid semi annually has five years to maturity of 7.5%. If interest rates rise and the yield to maturity increases to 7.8%, what will happen to the price of the bond?

A. fall by $9.82

B. fall by $11.59

C. rise by $12.16

D. The price of the bond will not change.

1 Answer

  • buz
    Lv 7
    8 years ago

    B. fall by $11.59

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