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 11:09 pm
A bond fund manager makes a forecast that she believes will be
accurate about interest rates in five years. She forecasts that
7-year bonds will yield 3% five years from now. Currently, a
12-year bond pays interest once per year of 4% and sells for price
of $927.25.
If the fund manager’s prediction is correct, what will the
bond’s price be five years from now in dollars and cents.
accurate about interest rates in five years. She forecasts that
7-year bonds will yield 3% five years from now. Currently, a
12-year bond pays interest once per year of 4% and sells for price
of $927.25.
If the fund manager’s prediction is correct, what will the
bond’s price be five years from now in dollars and cents.