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whispering corporation issues 590000 of 9% bonds due in 10 years, with interest payable semi annually....

whispering corporation issues 590000 of 9% bonds due in 10 years, with interest payable semi annually. at the time of issue, the market rate fir such bonds is 10%. compute the price of the bond?


Solutions

Expert Solution

Number of periods in case of semiannual Interest would be doubled and amounts to 20

whereas, the market rate used in discounting factor would be divided by 2 and amounts to 5%

and the Interest amount is also divided by 2

The following table helps to find the value of bond

ekkarill92 answered 2 years ago
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