Question

Question 5 (1 point) You are considering the purchase of CJ, Inc. bonds that mature in 17 years, and have a 7.375% coupon rate. Coupon payments are made semi-annually. If the appropriate required rate of return for this bond is 6.50, what is the value of the bond? (Express your answer to the nearest cent.i.e one thousand dollors would be entered as 1000.00).

Answer 1

value of the bond

=(1000*7.375%/2)*((1-(1+(6.50%/2))^(-17*2))/(6.50%/2))+1000/(1+(6.50%/2))^(17*2)

=1089.24

the above is answer..