Last year, Danielle bought a bond for $10,000 that promises to pay $1,150 a year. This...
Last year, Danielle bought a bond for $10,000 that promises to pay $1,150 a year. This year, a person who buys a bond for $10,000 receives $1,210 a year. If Danielle were to sell her (old) bond, its price would be approximately?
Homework Answers
Answer
The old bond price =(old bond price /new bond yearly earning)*old bond yearly earning
=(10000/1210)*1150
=9504.13223
The maximum price is $9504 approximately.
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