Find the price of a 10.00% coupon bond with a face value of $2000, a 12% yield to maturity, and 5 years to maturity.

Find the price of a 10.00% coupon bond with a face value of $2000, a 12% yield to maturity, and 5 years to maturity. PV = Price of the bond = $____(Round your response to two decimal places.)

Solutions

Expert Solution

Here, Given Data: r=12% = 0.12, n = 5, Face Value = $2000, i = 10% = 0.10

Price of the Bond = PV of Annuity + PV of lump sum

Now, put both value in equation of price of the Bond = $720.96 + $1134.85 = $1855.81

Rahul Sunny answered 1 year ago

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