You find a zero coupon bond with a par value of $10,000 and 20 years to maturity. The yield to maturity on this bond is 4.2 percent. Assume semiannual compounding periods. What is the dollar price of the bond? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Fundamentals of Financial Management (MindTap Course List)
14th Edition
ISBN:9781285867977
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Eugene F. Brigham, Joel F. Houston
Chapter7: Bonds And Their Valuation
Section: Chapter Questions
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Problem 7-9 Zero Coupon Bonds [LO2]
You find a zero coupon bond with a par value of $10,000 and 20 years to maturity. The
yield to maturity on this bond is 4.2 percent. Assume semiannual compounding
periods. What is the dollar price of the bond? (Do not round intermediate calculations
and round your answer to 2 decimal places, e.g., 32.16.)
Mc
Graw
Hill
Bond price
2
#3
$
4
< Prev
%
5
3 of 11
6
⠀
Next >
&
7
8
Transcribed Image Text:Problem 7-9 Zero Coupon Bonds [LO2] You find a zero coupon bond with a par value of $10,000 and 20 years to maturity. The yield to maturity on this bond is 4.2 percent. Assume semiannual compounding periods. What is the dollar price of the bond? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Mc Graw Hill Bond price 2 #3 $ 4 < Prev % 5 3 of 11 6 ⠀ Next > & 7 8
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