CHAPTER 17 PROBLEM 4

FINANCE  Investment Analysis and Portfolio Management CHAPTER 17 PROBLEM 4
 The Shamrock Corporation has just issued a $1,000 par value zero coupon bond with an 8   percent   yield   to   maturity,   due   to   mature   15   years   from   today   (assume   semiannual   compounding)  
   a. What is the market price of the bond?   
      b. If interest rates remain constant, what will be the price ot the bond in three years?    
     c. If interest rates rise to 10 percent, what will be the price of the bond in three years? 

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