The royalties from sales of the music are used to pay
interest and principal on the bonds. The bond was issued with a coupon rate of
6.9% and will mature on this day 28 years from now. The yield on the bond is
currently 6.15%. At what price should this bond trade today, assuming a face
value of $1,000 and annual coupons? Round
to nearest cent
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the price of the bond today = $ 1099.02 (answer)
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Jul 3rd, 2015
the current market rate of 6.150% for a similar bond, a bond with a
face value of $1,000.00 and paying a coupon rate of 6.900% (compounding
Annually), should be selling for $1,099.02 (selling at a premium).