Jordan bought a 4% semi-annual coupon bond with 25 years to maturity at par value of $1,000. If the required rate of return (yield to maturity )of this bond increases to 4.25%, by how much does the value of the bond change?
A) minus $38.04
B) plus $39.28
C) minus $38.27
D) The value does not change if Jordan intends to hold the bond to maturity.
Answer: C
Business
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