You invest in a 55 month $5,163 zero-coupon corporate bond at a simple discount rate of 9.73 per yea Determine the price of the bond and the true interest rate on the bond. a. The price of the bond is $ (Round to 2 decimal places) b. The true interest rate of the bond is x(Round to 4 decimal places X.XXXXX) Question Help: Written Example

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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Question 6
You invest in a 55 month $5,163 zero-coupon corporate bond at a simple discount rate of 9.73 per year.
Determine the price of the bond and the true interest rate on the bond.
a. The price of the bond is $
(Round to 2 decimal places)
b. The true interest rate of the bond is
* (Round to 4 decimal places X.XXXXK)
Question Help: O Written Example
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Transcribed Image Text:Question 6 You invest in a 55 month $5,163 zero-coupon corporate bond at a simple discount rate of 9.73 per year. Determine the price of the bond and the true interest rate on the bond. a. The price of the bond is $ (Round to 2 decimal places) b. The true interest rate of the bond is * (Round to 4 decimal places X.XXXXK) Question Help: O Written Example Submit Question
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