Bond Rates

1. Coupon Rates If a bond’s coupon rate were above its required rate of return, would its price be above or

below its par value? Explain.

Don't use plagiarized sources. Get Your Custom Essay on
Need an answer from similar question? You have just landed to the most confidential, trustful essay writing service to order the paper from.
Just from $11/Page
Order Now

2. Bond Price Sensitivity Is the price of a longterm bond more or less sensitive to a change in interest

rates than to the price of a short-term security? Why?

3. Required Return on Bonds Why does the required rate of return for a particular bond change

over time?