BDJ Co: Calculate coupon rate for new bonds to sell at par
BDJ Co. wants to issue new 20-year bonds for some much-needed expansion projects. The company currently has 9 percent coupon bonds on the market that sell for $1135, make semiannual payments, and mature in 20 years. What coupon rate should the company set on its new bonds if it wants them to sell at par?© SolutionLibrary Inc. solutionlibary.com 9836dcf9d7 https://solutionlibrary.com/business/finance/bdj-co-calculate-coupon-rate-for-new-bonds-to-sell-at-par-2e8
...ill the selling price and face value be equal (in this instance $1000).
So, we need to calculate the YTM on the existing 20 year ...