Question
Bond #1: 10 Year Maturity Bond #1 is a 10 year, 4.5% semiannual coupon bond. It has a par/face value of $5,000 and may be
Bond #1: 10 Year Maturity Bond #1 is a 10 year, 4.5% semiannual coupon bond. It has a par/face value of $5,000 and may be called in 6 years at a call price of $7,500. The bond sells for $5,250. Complete the information in the table below. Bond Information Formulas Years to maturity: 10 How long it is for Periods per year: 2 Number of times it pays interest Periods to maturity: number of years x number of payment periods 25 years x 2 period Coupon rate: 4.5% Your interest rate Par/face value: $5,000 Face valueaka the value of the bond Periodic payment: Par value x (coupon rate / periods per year) Current price $5,250 Sale price Call price: $7,500 Amount paid should the bond be called earlyaka the person using the bond money pays their loan off early Years till callable: 6 When they can call it in, meaning pay you the $6000 for it Periods till callable: number of years x number of periods
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