Homework Question Need Help With

Business & Finance
Tutor: None Selected Time limit: 1 Day

Suppose you purchase a zero coupon bond with a face value of $1,000, maturing in 22 years, for $215.30. Zero coupons pays the investor the face value of the maturity date. What is the implicit interest in the first year of the bonds life?

Jul 8th, 2015

Thank you for the opportunity to help you with your question!

 $17.11 answer

1000 FV, 22 N, -215 PV, CPT I/Y = YTM = 8.3%; Year 1 interest = $215 x .012 = $17.11


Please let me know if you nea case for torture by michale levined any clarification. I'm always happy to answer your questions.
Jul 8th, 2015

Question state $215.30 not $215. Did you read question?

Jul 8th, 2015

Sorry. ...sir I calculate in a hurry....thats why missed that.....only just put 0.30.....calculation is correct

Jul 8th, 2015

Did you know? You can earn $20 for every friend you invite to Studypool!
Click here to
Refer a Friend
...
Jul 8th, 2015
...
Jul 8th, 2015
May 24th, 2017
check_circle
Mark as Final Answer
check_circle
Unmark as Final Answer
check_circle
Final Answer

Secure Information

Content will be erased after question is completed.

check_circle
Final Answer