Gong Li has recently inherited $10,000 and is considering purchasing 10 bonds of the Lucky Corporation. The bond has a par value of $1,000 with 10 percent coupon rate and will mature in 10 years
Does Gong Li have enough money to buy 10 bonds if the required rate of return is 9 percent?
No. Since the required rate of return (9%) is less than the bond's coupon rate (10%), the bond's price is greater than its par value ($1,000). Thus, the total price of 10 bonds is greater than $10,000.
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The _____ environment consists of forces that influence market operations, like commodity prices and interest rates.
Fill in the blank(s) with the appropriate word(s).
What is credit life insurance?
A) Policies that cover payment of a debt if the debtor dies B) Life insurance purchased through credit card solicitation C) Credit given to policyholders who consistently pay their premiums on time D) Insurance offered on credit when the policyholder is unable to pay premiums