Ex. 4 Calculate the price of the following bond issues:: Bond face value 100 100 100 Coupon rate 3% 3% 3% coupon payment 3 3 3 Maturity t 2 10 25 Annual n 1 1 1 yield to maturity 5% 5% 5% What can you conclude from the relationship between bond price and maturity of the bond ?
The flotation cost on all three bond issues is of 2%, calculate the net proceeds of all three bonds