November 28, 2015

Homework Help: STOCKS & BONDS

Posted by Yinka on Thursday, November 15, 2012 at 10:24am.

Two years ago, Gamma Inc. sold a $250 million bond issue to finance the purchase of new jet airliners. These bonds were issued in $1,000 denominations with an original maturity of 14 years and a coupon rate of 12% with interest paid semiannually. Determine the value today of one of these bonds to an investor who requires a 14 percent return on these securities. Explain why the bond has a value that is not equal to the par value.

Answer this Question

First Name:
School Subject:

Related Questions

More Related Questions