Change in the Bond’s Price Assignment | Homework For You
A corporate bond with a coupon rate of 6.6 percent has 12 years left to maturity. It has had a credit rating of BBB and a yield to maturity of 7.3 percent. The firm has recently gotten into some trouble and the rating agency is downgrading the bonds to BB.
The new appropriate discount rate will be 8.6 percent. (Assume interest payments are semiannual.) points
What will be the change in the bond’s price in dollars? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your final answer to 2 decimal places.)
What will be the change in the percentage? (Negative answer should be indicated by a minus sign. Do not round intermediate calculations. Round your final answer to 2 decimal places.) Change in bond percent. Get Finance homework help today