A bond has a par value of $1,000, a time to maturity of 10 years, and a coupon rate of 8% with interest paid

A bond has a par value of $1,000, a time to maturity of 10 years, and a coupon rate of 8% with interest paid semi-annually. If the current market price is $750, what is the yield to maturity for this bond? What would happen to this bond’s price if yield to maturity suddenly dropped to 3.5%? Describe/comment on the relationship between yields and bond prices.

File name: A-bond-has-a-par-value-of.xls File type: application/vnd.ms-excel Price: $6