5-11. Last month Jim purchased $10,000 of U.S. Treasury bonds (their face value was $10,000). These bonds

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5-11. Last month Jim purchased $10,000 of U.S. Treasury bonds (their face value was $10,000). These bonds have a 30-year maturity period, and they pay 1.5% interest every three months (i.e., the APR is 6%, and Jim receives a check for $150 every three months). But interest rates for similar securities have since risen to a 7% APR because of interest rate increases by the Federal Reserve Board. In view of the interest-rate increase to 7%, what is the current value of Jim’s bonds? (5.3)

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Engineering Economy

ISBN: 9780134870069

17th Edition

Authors: William Sullivan, Elin Wicks, C Koelling

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