On 31 March 2003, Hind Tobacco Company issued Rs. 1000 face value bonds due on 31...

On 31 March 2003, Hind Tobacco Company issued Rs. 1000 face value bonds due on 31 March 2013. The company will not pay any interest on the bond till 31 March 2008. The half-yearly interest is payable from 31 December 2008; the annual rate of interest will be 12%. The bonds will be redeemed at 5% premium on maturity i.e. 2013. What is the value of the bond if the required rate of return is 14%? ( please show the entire working)

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jeff jeffy answered 1 year ago

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