12 year from now, Hill Inc. will pay 32,356 for its bond. You would like to...

12 year from now, Hill Inc. will pay 32,356 for its bond. You would like to buy it. An interest rate of the bond is 7%. How much is it worth today? (annual compounding).

Expert Solution

	Worth today	FV×(1÷(1+r)^n)

	Here,

A	rate per annum	7.00%
B	Number of years	12
C	Number of compoundings per per annum	1
A÷C	rate per period ( r)	7.00%
B×C	Number of periods (n)	12
	Future value (FV)	32,356

	Worth today	$ 14,366.45
		32356×(1÷(1+7%)^12)

jeff jeffy answered 2 years ago

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