Question
In: Finance
Lucia just bought one coupon bond with a principal amount of $1,000 with an annual coupon...
Lucia just bought one coupon bond with a principal amount of $1,000 with an annual coupon rate of 7.1%. The bond pays annual interest payment and will mature in three years. The yield to maturity of this coupon bond is 2.31%. How much did Lucia pay to buy this 3-year coupon bond?
Please round your answer to the second decimal. E.g. 1234.56
Solutions
Expert Solution
rate positively ..
| We have to use financial calculator to solve this | |||
| put in calculator | |||
| FV | 1,000 | ||
| PMT | 1,000*7.1% | 71 | |
| I | 2.31% | ||
| N | 3 | ||
| compute PV | ($1,137.31) | ||
| Price = | $1,137.31 | ||
| ans = | $1,137.31 |
jeff jeffy answered 2 years agoRelated Solutions
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