Answer the following situation show your Complete Solution. Show the formulas. a. A bond with face value of Php 1,000 is selling at Php 950. The maturity of the bond is one year. How much is its gain ? b. A bond with Php5,000 face value pays 10% coupon rate semi - annually . If the maturity of the bond is 2 years , how much is the coupon paid semi - annually ? Find the total coupon during the life of the bond . Answers ( I already provided the answers just please show the solutions with correct formulas THANK YOU): a. Php 50 is the amount of gain. b. Php 500 is the among of semi-annual coupon. Php 2 000 is the total coupon since there are  4 periods in two years.

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
Problem 16P
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Answer the following situation show your Complete Solution. Show the formulas.

a. A bond with face value of Php 1,000 is selling at Php 950. The maturity of the bond is one year. How much is its gain ?

b. A bond with Php5,000 face value pays 10% coupon rate semi - annually . If the maturity of the bond is 2 years , how much is the coupon paid semi - annually ? Find the total coupon during the life of the bond .

Answers ( I already provided the answers just please show the solutions with correct formulas THANK YOU):

a. Php 50 is the amount of gain.

b. Php 500 is the among of semi-annual coupon. Php 2 000 is the total coupon since there are  4 periods in two years.

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