Ms. Jones want to make 12% nominal interest compunded quarterly on a bond investment. She has an opportunity to purchase a 10% , $10000 bond that will mature in 18 years and pays quarterly interest. this means that she eill receive quarterly interest payments on the face value of the bond ($10000) at 10% nominal interest. after 18 years she will receive the face value of the bond. How much should she be willing to pay for the bond today?

Ms. Jones want to make 12% nominal interest compunded quarterly on a bond investment. She has an opportunity to purchase a 10% , $10000 bond that will mature in 18 years and pays quarterly interest. this means that she eill receive quarterly interest payments on the face value of the bond ($10000) at 10% nominal interest. after 18 years she will receive the face value of the bond. How much should she be willing to pay for the bond today?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 22P

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