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MBA,MCS,M.phil
Devry University
Jan-2008 - Jan-2011
MBA,MCS,M.Phil
Devry University
Feb-2000 - Jan-2004
Regional Manager
Abercrombie & Fitch.
Mar-2005 - Nov-2010
Regional Manager
Abercrombie & Fitch.
Jan-2005 - Jan-2008
(9) Yield to maturity: Heymann Company bonds have 4
years left to maturity. Interest is paid annually, and
the bonds have a $1,000 par value and a coupon rate of
9 percent.
a. What is the yield to maturity at a current market
price of (1) $829 or (2) $1,104?
b. Would you pay $829 for each bond if you thought
that a “fair” market interest rate for such bonds was
12 percent—that is, if rd = 12 percent? Explain your
answer.
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