00 points Bond X is a premium bond making annual payments. The bond pays an 8 pe

Question

00 points


Bond X is a premium bond making annual payments. The bond pays an 8 percent coupon, has a YTM of 6 percent, and has 13 years to maturity. Bond Y is a discount bond making annual payments. This bond pays a 6 percent coupon, has a YTM of 8 percent, and also has 13 years to maturity. Assume the interest rates remain unchanged
Requirement 6:
What do you expect the prices of these bonds to be in 13 years? (Do not include the dollar signs ($). Enter rounded answers as directed, but do not use the rounded numbers in intermediate calculations.)

Explanation / Answer

Bond value
$50  [(1  1/1.06 40 )/.06]  1,000/1.06 40
$50  15.04630  1,000/10.2857
$849.54

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