A bond has a 10-year maturity, a 5% coupon paid semiannually, and $1000 par value.
The required rate of return (yield to maturity)on the bond is 11%.
Compute the price of the bond today using the mathematical formula
(the formula has two main terms, the present value of coupons, and the present value of the par repayment)
SHOW EQUATIONS IN EXCEL
PV coupon payments
PV par repayment
PV bond
A $1000 par value bond has a 5% coupon paid semiannually and a 10-year maturity.
The required rate of return (yield to maturity)on the bond is 11%.
Compute the price of the bond today using the appropriate Excel formula
SHOW WORK HERE, HIGHLIGHT FINAL ANSWER IN YELLOW
PV
RATE
NPER
PMT
FV

SHOW EQUATIONS IN EXCEL