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    Yield to maturity and Bond Price

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    A 10-year corporate bond is issued with a face value of $100,000, paying interest of $2,500. semi-annually. If market yields decrease shortly after the T-bond is issued, what happens to the bond's:

    a. price?
    b. coupon rate?
    c. yield to maturity?

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    Solution Preview

    Market yield = Annual interest / Market Price,
    Yield to maturity (YTM), is the interest rate by which the ...

    Solution Summary

    This discusses the relationship between Yield to maturity and Bond Price