Fancy Food, Inc. has issued a bond with par value of $1,000; coupon rate of 9 percent

Question:

Fancy Food, Inc. has issued a bond with of $1,000; rate of 9 percent paid semi-annually, and matures in 10 years. What is the value of the bond if the required rate of return is 12 percent?

Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...