Calculate the value of the bond

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Reference no: EM13332152

A bond of Telink corporation pays $100 in annual interest, with a $1,000 par value. The bonds mature in 25
years. The market's required yield to maturity on a comparable bond is 8 percent.
a. Calculate the value of the bond.
b. How does the value change if the market's required yield to maturity on a comparable risk bond (i)
increase to 12 percent or (ii) decreases to 6 percent?
c. Interpret your findings in parts a and b.

Reference no: EM13332152

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