Navarro, Inc., plans to issue new zero coupon bonds with a par value of $1,000 to fund a new project. The bonds will have a YTM of 6.09 percent and mature in 15 years. If we assume semiannual compounding, at what price will the bonds sell?
$406.62
$390.36
$411.99
$393.07
$396.46
Price of bonds=Par value/(1+YTM/2)^(2*time period)
=1000/(1+0.0609/2)^(2*15)
=$1000/(1.03045)^30
=$1000*0.40662333
=$406.62(Approx).
Navarro, Inc., plans to issue new zero coupon bonds with a par value of $1,000 to...
Navarro, Inc., plans to issue new zero coupon bonds with a par value of $1,000 to fund a new project. The bonds will have a YTM of 5.61 percent and mature in 15 years. If we assume semiannual compounding, at what price will the bonds sell?
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