Moerdyk Corporation's bonds have a 15-year maturity, a 7.25% semiannual coupon, and a par value of...

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Moerdyk Corporation's bonds have a 15-year maturity, a 7.25% semiannual coupon, and a par value of...

Moerdyk Corporation's bonds have a 15-year maturity, a 7.25% semiannual coupon, and a par value of $1,000. The going interest rate (rd) is 5.30%, based on semiannual compounding. What is the bond’s price? a. $1,200.05 b. $1,164.05 c. $948.04 d. $1,224.05 e. $1,500.06

A. a
B. b
C. c
D. d
E. e

business finance

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Answer 1

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Answer #1

Bond's price is calculated using the PV function as follows:

=PV(5.3%/2,15*2,7.25%/2*1000,1000)

=1200.05

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Answer 2

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