Fundamentals of Corporate Finance, 2/e. ROBERT PARRINO, PH.D. DAVID S. KIDWELL, PH.D. THOMAS W. BATES, PH.D. Bond Valuation and the Structure of Interest Rates. Learning Objectives. Describe the market for corporate bonds and three types of corporate bonds.
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ROBERT PARRINO, PH.D.
DAVID S. KIDWELL, PH.D.
THOMAS W. BATES, PH.D.
calculate bond price
PB = PVCoupon Payments+ PVPar Value
3
10
80
1,000
Enter
N
i
PV
PMT
FV
Answer
950.26
6
4
25
1,000
Enter
N
i
PV
PMT
FV
Answer
921.37
60
800
40
1,000
Enter
N
i
PV
PMT
FV
Answer
5.07
.0507
2
Enter
x
=
Answer
.1014
1.0507

=
Enter
X2
1
Answer
.1040
Exhibit 8.2 Relation Between Bond Price Volatility and Maturity
Exhibit 8.5 Default Risk Premiums for Selected Bond Ratings
Exhibit 8.6