A bond fund manager makes a forecast that she believes will be accurate about interest rates in five years. She forecast
Posted: Wed May 18, 2022 11:01 pm
A bond fund manager makes a forecast that she believes will be
accurate about interest rates in five years. She forecasts that
10-year bonds will yield 8% five years from now. Currently, a
15-year bond pays interest once per year of 6% sells for price of
$867.42. If the fund manager’s prediction is correct, what will the
bond’s price be five years from now in dollars and cents. (Use a
financial calculator or Excel to solve this.)
accurate about interest rates in five years. She forecasts that
10-year bonds will yield 8% five years from now. Currently, a
15-year bond pays interest once per year of 6% sells for price of
$867.42. If the fund manager’s prediction is correct, what will the
bond’s price be five years from now in dollars and cents. (Use a
financial calculator or Excel to solve this.)