财管课件FinancialManagementtopic042013课程.ppt

Interest Rate Risk * Bond Prices fluctuate over Time As interest rates in the economy change, required rates on bonds will also change resulting in changing market prices. Interest Rates VB Interest Rate Risk * Bond Prices fluctuate over Time As interest rates in the economy change, required rates on bonds will also change resulting in changing market prices. Interest Rates VB Interest Rates VB 4-* Figure 6.4 Bond Values and Required Returns * Example A three-year bond has a coupon of 8% and a YTM of 7%. Explain why this bond should sell at a premium. The bond should sell at a premiu