What is the price of the bonds

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Reference no: EM131459818

Doisneau 20-year bonds have an annual coupon interest of 7 percent, make interest payments on a semiannual basis, and have a $1,000 par value. If the bonds are trading with a market's required yield to maturity of 15 percent, are these premium or discount bonds? Explain your answer. What is the price of the bonds a. If the bonds are trading with a yield to maturity of 15%, then (Select the best choice below.)

A. the bonds should be selling at par because the bond's coupon rate is equal to the yield to maturity of similar bonds.

B. the bonds should be selling at a discount because the? bond's coupon rate is less than the yield to maturity of similar bonds.

C. there is not enough information to judge the value of the bonds.

D. the bonds should be selling at a premium because the bond's coupon rate is greater than the yield to maturity of similar bonds.

Reference no: EM131459818

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