An investor has a bond with a 10% coupon, 40 years maturity with a par value of $1,000 paying 80 semi-annual coupons payments of $50. The interest rate is 10% annually. What is the bond value today? (show your workings)
An investor has a bond with a 10% coupon, 40 years maturity with a par value of $1,000 paying 80 semi-annual coupons payments of $50. The interest rate is 10% annually. What is the bond value today? (show your workings)
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter4: Bond Valuation
Section: Chapter Questions
Problem 4MC
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An investor has a bond with a 10% coupon, 40 years maturity with a par value of $1,000 paying 80 semi-annual coupons payments of $50. The interest rate is 10% annually. What is the bond value today? (show your workings)
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