Question

Consider the following three bonds which you bought today at the listed purchase prices. Bond A:...

Consider the following three bonds which you bought today at the listed purchase prices.

Bond A: Purchase price $15,000 with Face Value of $20,000 in 1 years.

Bond B: a perpetuity has a price of $1250 and an annual coupon payment of $25

Bond C: Purchase price of $15000, Face Value of $20,000 in 10 years and pays annual coupon payments of $25

Assume 1 year from now you want to sell these bonds: For each of these bonds calculate price after 1 year and the Holding period Return if interest rate after 1 year is 5%

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