Question
In: Finance
Assume a par value of $1,000. Caspian Sea plans to issue a 9.00 year, annual pay...
Assume a par value of $1,000. Caspian Sea plans to issue a 9.00 year, annual pay bond that has a coupon rate of 7.95%. If the yield to maturity for the bond is 8.49%, what will the price of the bond be?
Solutions
Expert Solution
Interest = $1,000 * 0.0795 = $79.5
Current bond price = $79.5(PVIFA 8.49%,9) + $1,000(PVIF 8.49%,9)
Current bond price = ($79.5 * 6.1215793203) + ($1,000 * 0.48027791565)
Current bond price = $966.94
jeff jeffy answered 2 years agoRelated Solutions
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#3
Assume a par value of $1,000.
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Answer format: Currency: Round to: 2
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Answer format: Currency: Round to: 2
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