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Author Question: Company A has two 9% coupon bonds outstanding. Each of the bonds pays interest annually. Bond A has ... (Read 39 times)

ncasson210

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on: Aug 7, 2023
Company A has two 9% coupon bonds outstanding. Each of the bonds pays interest annually. Bond A has 15 years to maturity and Bond B has 12 years to maturity. The current market rate of return is 7%. What will happen if the market rate of return decreases to 6%?

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The percentage change in the price of Bond A will be the same as the percentage change in the price of Bond B.


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The percentage change in the price of Bond A will be less than the percentage change in the price of Bond B.


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The percentage change in the price of Bond A will be greater than the percentage change in the price of Bond B.


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The price of the bonds will not change as the market rate of return has no effect on the value of the bond.

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by ncasson210 on Aug 7, 2023

risolinick@gmail.com

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Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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ncasson210

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Reply 2 on: Aug 7, 2023
Great answer, keep it coming :)

bassamabas

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Reply 3 on: Yesterday
Gracias!

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