Question:
does anyone have the formula for this problem-imlost and have no clue how to do this--help!!?
anonymous
2008-11-24 09:19:41 UTC
heres the question if u answer this ur a finance god!!

A bond is available for purchase that has a face value of $10000, an 8% coupon, payable semiannually, and 20yrs of its original 25 yrs left to maturity. Approximately how much would you pay for the bond if the market return on similar bonds is 10%...
my book was stolen and i cant find anything on the internet---can some one pleasse help--i need this question for a test --thanks
One answer:
Ed Atun
2008-11-24 13:44:51 UTC
$75,000. You need to buy it at a discount in order to increase it's return to match the market return..


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