Question

Grohl Co. issued 16-year bonds a year ago at a coupon rate of 6 percent. The bonds make semiannual payments. If the YTM on these bonds is 8 percent, what is the current bond price?

Answer 1

Current bond price	827.08
Since 1 year has elapsed only 15 years are left for maturity
Statemnet showing Price or Intrinsic Value
Particulars	Time	PVf 4%	Amount	PV
Cash Flows (Interest)	0.50	0.9615	30.00	28.85
Cash Flows (Interest)	1.00	0.9246	30.00	27.74
Cash Flows (Interest)	1.50	0.8890	30.00	26.67
Cash Flows (Interest)	2.00	0.8548	30.00	25.64
Cash Flows (Interest)	2.50	0.8219	30.00	24.66
Cash Flows (Interest)	3.00	0.7903	30.00	23.71
Cash Flows (Interest)	3.50	0.7599	30.00	22.80
Cash Flows (Interest)	4.00	0.7307	30.00	21.92
Cash Flows (Interest)	4.50	0.7026	30.00	21.08
Cash Flows (Interest)	5.00	0.6756	30.00	20.27
Cash Flows (Interest)	5.50	0.6496	30.00	19.49
Cash Flows (Interest)	6.00	0.6246	30.00	18.74
Cash Flows (Interest)	6.50	0.6006	30.00	18.02
Cash Flows (Interest)	7.00	0.5775	30.00	17.32
Cash Flows (Interest)	7.50	0.5553	30.00	16.66
Cash Flows (Interest)	8.00	0.5339	30.00	16.02
Cash Flows (Interest)	8.50	0.5134	30.00	15.40
Cash Flows (Interest)	9.00	0.4936	30.00	14.81
Cash Flows (Interest)	9.50	0.4746	30.00	14.24
Cash Flows (Interest)	10.00	0.4564	30.00	13.69
Cash Flows (Interest)	10.50	0.4388	30.00	13.17
Cash Flows (Interest)	11.00	0.4220	30.00	12.66
Cash Flows (Interest)	11.50	0.4057	30.00	12.17
Cash Flows (Interest)	12.00	0.3901	30.00	11.70
Cash Flows (Interest)	12.50	0.3751	30.00	11.25
Cash Flows (Interest)	13.00	0.3607	30.00	10.82
Cash Flows (Interest)	13.50	0.3468	30.00	10.40
Cash Flows (Interest)	14.00	0.3335	30.00	10.00
Cash Flows (Interest)	14.50	0.3207	30.00	9.62
Cash Flows (Interest)	15.00	0.3083	30.00	9.25
Cash flows (Maturity Amount)	15.00	0.3083	1,000.00	308.32
Intrinsic Value of Bond or Current Bond Price				827.08