Pricing bonds [5 min]
Bond prices depend on the market rate of interest, stated rate of interest, and time.
Requirements
1. Compute the price of the following 7% bonds of United Telecom.
a. $500,000 issued at 76.75.
b. $500,000 issued at 104.75.
c. $500,000 issued at 95.75.
d. $500,000 issued at 104.25.
2. Which bond will United Telecom have to pay the most to retire the bond at maturity? Explain your answer.
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