Asked Oct 2, 2019

Union Local School District has a bond outstanding with a coupon rate of 2.9 percent paid semiannually and 24 years to maturity. The yield to maturity on this bond is 3.4 percent, and the bond has a par value of $10,000. 


What is the price of the bond?


Expert Answer

Step 1

Calculation of Price of the Bond:

The price of the bond is $9,184.18.

Excel Spreadsheet:


Image Transcriptionclose

В А $10,000 1 Face Value 2 Coupon Rate 3 Coupon Payment 4 Yield to Maturity 5 Number of Periods Price of BondS9,184.18 2.90% $145.00 1.70% 48 6


Want to see the full answer?

See Solution

Check out a sample Q&A here.

Want to see this answer and more?

Solutions are written by subject experts who are available 24/7. Questions are typically answered within 1 hour.*

See Solution
*Response times may vary by subject and question.
Tagged in




Related Finance Q&A

Find answers to questions asked by student like you
Show more Q&A

Q: Sure Tea Co. has issued 4.2% annual coupon bonds that are now selling at a yield to maturity of 5.60...

A: Face Value of Bond = $1,000Coupon Rate = 4.2%Coupon Payment = $1,000 × 4.2% = $42Current Yield = 5.5...


Q: Which are the main legislative acts governing the Mergers & Aquisition activities in the United ...

A: Mergers and Acquisitions (M&A) are transactions of uniting two or more companies into one. The m...


Q: A devoted Indiana basketball fan needs $11,200.00 to attend the Final Four exactly one year from tod...

A: As a first step let's assign a symbol to each of the information we have:Future value, FV = $ 11,200...


Q: UBTECH Robotics is expected to generate the following free cash flows over the next fiveyears. After...

A: Discounted cash flow (DCF) method is a popular valuation technique. It discounts the future cash flo...


Q: In 2021, Jake's Jamming Music, Inc., announced an ROA of 8.65 percent, ROE of 15.40 percent, and pro...

A: ROA = Net income / Total assets = 8.65%ROE = Net income / Total Equity = 15.40%Profit margin = Net i...


Q: A firm evaluates all of its projects by applying the IRR rule. The required return for the following...

A: Calculation of IRR:Using Excel Spreadsheet:


Q: What is the present value of $6,700 received 14 years from now using a 11% interest or discount rate...

A: Calculation of Present Value:The Present Value is $1,466.53.Excel Spreadsheet:


Q: Suppose a security follows a geometric Brownian motion with interest rate r=0.01, volatility paramet...

A: The formula I have for simlating the prices have mu and sigma, but no r (Interest rate). Please repo...


Q: A privately run, for-profit, prison is considering ways in which it can cut its monthly costs and th...

A: Calculate the present value as follows: