ABC Corp. issued a 12 percent, 20 year coupon rate bond 5 years ago. Interest rates are now 8 percent Based on semi-annu

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Abc Corp Issued A 12 Percent 20 Year Coupon Rate Bond 5 Years Ago Interest Rates Are Now 8 Percent Based On Semi Annu 1 (53.64 KiB) Viewed 112 times

ABC Corp. issued a 12 percent, 20 year coupon rate bond 5 years ago. Interest rates are now 8 percent Based on semi-annual analysis and using the table below or your calculator, what is the current price of the bond? Period 8% 15 20 30 40 PV of $1 Percent 4% 6% .555 .417 .456 .312 .308 .174 .208 .097 8% 129 .315 .183 .215 .104 ..099 .033 .046 .011 4% 11.118 13.590 17.292 19.793 PV of an annuity of $1 Percent 6 12% 9.712 8.559 6.811 11.470 9.818 7.469 13.765 11.258 8.005 15.046 11.925 8.244 FABI E E % 3 As the yield to maturity on a bond increases, the duration also increases, because of the effect of present value on duration. (True/False) Select one: True False