Time remaining:
I need help. I need to show my work

Business & Finance
Tutor: None Selected Time limit: 0 Hours

Your company issues 6% coupon bonds with a face value of $1,000.  Suppose these bonds have 7 years to maturity, make semiannual payments, and have a yield to maturity of 8%.

6a.  What is the current price of the bonds?

Apr 5th, 2015

Present Value of Interest Payments = c × F × 1 − (1 + r)-t+Fr(1 + r)t


6%*1000*((1-(1+8%)^-7 )/8% +1000/(1+8%)^7

60*((1-(1+8%)^-7 )/8% +1000/(1+8%)^7

35,354.22

Apr 5th, 2015

Did you know? You can earn $20 for every friend you invite to Studypool!
Click here to
Refer a Friend
...
Apr 5th, 2015
...
Apr 5th, 2015
Feb 26th, 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