assignmentcafe.com – What coupon rate should the firm set on these new bonds?/2022

assignmentcafe.com –

Question 11

 

Micro Robos Inc. has 6.75% coupon bonds with 10 year maturity remaining and current market value of $975.80. These bonds pay coupon semi annually. The firm wants to sell additional 10-year maturity bonds now at par with coupon rate being same as the current market rate of interest. What coupon rate should the firm set on these new bonds?

 

 

 

Group of answer choices

 

 

 

3.80%

 

 

 

7.48%

 

 

 

7.59%

 

 

 

3.55%

 

 

 

7.09%