A company issues a ten-year bond at par with a coupon rate of 6.4% paid semi-annually. The YTM at the beginning of the third year of the bond (8 years left to maturity) is 9.1%. What is the new price of the bond?

[tex]current \ price \ of \ the \ bond= ( coupon \times \dfrac{ (1- \dfrac{1}{(1+YTM)^{no \ of \ period }})}{YTM} + \dfrac{Face \ Value }{(1+YTM ) ^{no \ of \ period}}[/tex]

[tex]current \ price \ of \ the \ bond= ( \dfrac{0.064 \times \$1000}{2} \times \dfrac{ (1- \dfrac{1}{(1+ \dfrac{0.091}{2})^{8 \times 2}})}{\dfrac{0.091}{2}} + \dfrac{\$1000 }{(1+\dfrac{0.091}{2} ) ^{8 \times 2}})[/tex]

[tex]current \ price \ of \ the \ bond= \$32 \times $11.19 + \$490.70[/tex]

[tex]current \ price \ of \ the \ bond= \$358.08+ \$490.70[/tex]

[tex]\mathbf{current \ price \ of \ the \ bond= \$848.78}[/tex]

A company issues a​ ten-year bond at par with a coupon rate of 6.4​% paid​ semi-annually. The YTM at the beginning of the third year of the bond​ (8 years left to​ maturity) is 9.1​%. What is the new price of the​ bond?

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A company issues a ten-year bond at par with a coupon rate of 6.4% paid semi-annually. The YTM at the beginning of the third year of the bond (8 years left to maturity) is 9.1%. What is the new price of the bond?