Assume that you are considering the purchase of a 15-year, noncallable bond with an annual coupon rate of 9.55%.  The bond has a face value of $1000, and it makes semiannual interest payments.  If you require an 12.50%  yield to maturity on this investment, what is the maximum price you should be willing to pay for the bond?Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72.   A. $673.92 B. $802.29 C. $689.97 D. $874.49 E. $665.90

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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Assume that you are considering the purchase of a 15-year, noncallable bond with an annual coupon rate of 9.55%.  The bond has a face value of $1000, and it makes semiannual interest payments.  If you require an 12.50%  yield to maturity on this investment, what is the maximum price you should be willing to pay for the bond?

Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72.
 
A. $673.92
B. $802.29
C. $689.97
D. $874.49
E. $665.90
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