A 3-year bond with a 10% coupon rate paid annually and a $1,000 face value sells...
A 3-year bond with a 10% coupon rate paid annually and a $1,000
face value sells at a nominal yield
to maturity 8% (APR). What is the price of the bond?
N:
I/Y:
PV:
PMT:
FV:
Mode:
Excel Formula:
Bond Proceeds:
Quoted Bond Price:
Homework Answers
Price of the Bond = 100* 2.577 +1000*0.7938= 1051.50
N: 3*1=3
I/Y: 0.08/1 =0.08
PV of interest payment: 100*2.577=257.7
PMT: 1000*.10
FV:1000
Bond Proceeds:1000*0.7938=793.80
Quoted Bond Price:1051.50
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