Question

Bond valuation—Semiannual interest Find the value of a bond maturing in 4 years

Bond valuation—Semiannual interest Find the value of a bond maturing in 4 years, with a $1,000 par value and a coupon interest rate of 9% (4.5% paid semiannually) if the required return on similar-risk bonds is 12% annual interest (6% paid semiannually). 


The present value of the bond is $. (Round to the nearest cent.)

1 0
Add a comment Improve this question Transcribed image text
Answer #1

Present value of the bond is calculated as:

=PV(rate,nper,pmt,fv)

=PV(12%/2,4*2,-9%/2*1000,-1000)

=906.85

Add a comment
Know the answer?
Add Answer to:
Bond valuation—Semiannual interest Find the value of a bond maturing in 4 years
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT