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B D 1 A 10-year, $300,000 bond is issued at a price to yield 10%. Interest is paid semiannually. 3 Annual contract rate(stated rate) 12%
B D 1 A 10-year, $300,000 bond is issued at a price to yield 10%. Interest is paid semiannually. 3 Annual contract rate(stated rate) 12% Annual market rate (effective rate) 10% 5 Payments within year 2 6 Years to maturity 10 7 Par (face) value $300,000 8 Issue price $337,387 9 10 Using the PV function, the issue price of the bond is determined to be $337,387. Function Arguments PV Rate + - number Nper t - number Fv Type 1. number Returns the present value of an investment the total amount that a series of future payments is worth now. Which is the correct formula for the Nper variable? Multiple Choice =85 =B6/B5 =6665 =66
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