Compute the selling price of 10%, 10-year bonds with a par value of $290,000 and semiannual interest payments

QS 14-19A (Algo) Computing bond price C2 Compute the selling price of 10%, 10-year bonds with a par value of $290,000 and semiannual interest payments. The annual market rate for these bonds is 12%. Use present value Table B.1 and Table B.3 in Appendix B. (Round all table values to 4 decimal places, and use the rounded table values in calculations.) Cash Flow $290,000 par (maturity) value $14,500 interest payment Price of Bond Table Value 0.9901 12.0000 $ Present Value 290,000 10,000 Table B.1* Present Value of 1 p=1/(1+i)" Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 15% Periods 1 0.9901 0.9804 0.9709 0.9615 0.9434 0.9346 0.9259 0.9174 0.9091 0.8929 0.8696 1 2 0.9803 0.9612 0.9426 0.9246 0.9524 0.9070 0.8638 0.8734 0.8573 0.7561 2 0.8417 0.7722 0.8264 0.7513 0.7972 0.7118 3 0.9706 0.9423 0.9151 0.8890 0.7938 0.6575 3 0.8900 0.8396 0.7921 0.7473 0.8163 0.7629 4 0.9610 0.9238 0.8885 0.8548 0.7350 0.7084 0.6830 0.6355 0.5718 4 0.8227 0.7835 5 0.9515 0.8626 0.6806 0.6499 0.6209 0.5674 0.4972 5 0.9057 0.8880 0.8219 0.7903 6 0.9420 0.8375 0.7462 0.7130 0.6663 0.6227 0.6302 0.5963 0.5066 0.7050 0.6651 6 0.5645 0.5132 0.4323 0.3759 7 0.9327 0.8706 0.8131 0.7599 0.7107 0.5835 0.5470 0.4523 7 8 0.8535 0.7894 0.7307 0.6768 0.6274 0.5820 0.5403 0.5019 0.4039 0.3269 8 9 0.8368 0.7026 0.6446 0.2843 0.9235 0.9143 0.9053 0.8963 9 0.7664 0.7441 0.5919 0.5584 0.4665 0.4241 0.3855 0.5439 0.5083 10 0.8203 0.6139 0.4604 0.4224 0.3875 0.6756 0.6496 0.5002 0.4632 0.4289 0.3971 10 0.3606 0.3220 0.2875 0.2472 0.2149 11 0.8043 0.7224 0.5847 0.3505 11 0.5268 0.4970 0.4751 0.4440 12 0.8874 0.7014 0.6246 0.3555 0.3186 0.2567 12 13 0.7885 0.7730 0.7579 0.1869 0.1625 0.6810 0.6006 0.5568 0.5303 0.5051 0.3677 0.2897 0.2292 0.8787 0.8700 0.8613 13 0.4688 0.4423 0.4150 0.3878 0.3262 0.2992 14 14 0.6611 0.6419 0.5775 0.5553 15 0.1413 0.1229 0.7430 0.4810 0.4173 0.3405 0.3152 0.2919 0.2745 0.3624 0.3387 0.2046 0.1827 0.1631 15 0.2633 0.2394 0.2176 0.1978 16 0.2519 16 0.8528 0.8444 0.7284 0.7142 0.6232 0.6050 0.5339 0.5134 0.4581 0.4363 0.3936 0.3714 0.1069 0.0929 17 0.3166 0.2703 0.2311 17 0.1456 0.1300 18 0.8360 0.7002 0.5874 0.4936 0.3503 0.2959 0.2502 0.2120 0.1799 0.0808 18 19 0.6864 0.4746 0.1945 0.1635 0.0703 19 0.8277 0.8195 0.4155 0.3957 0.3769 0.2953 0.2765 0.2584 20 0.1161 0.1037 0.6730 0.3305 0.3118 0.2330 0.4564 0.2317 0.2145 0.1460 0.0611 20 0.5703 0.5537 0.4776 0.4120 0.3554 0.1784 0.1160 0.1486 0.0923 25 0.7798 0.6095 0.1842 0.0588 0.0304 25 0.3751 0.3083 30 0.7419 0.5521 0.1741 0.1314 0.0994 0.0573 0.0334 0.0151 30 0.2314 0.1813 0.0754 0.0490 35 0.5000 0.1301 0.0676 0.0356 0.0189 0.0075 35 0.7059 0.6717 0.2534 0.2083 0.0937 0.0668 40 0.4529 0.3066 0.1420 0.0972 0.0460 0.0318 0.0221 0.0107 0.0037 40 *Used to compute the present value of a known future amount. For example: How much would you need to invest today at 10% compounded semiannually to accumulate $5,000 in 6 years from today? Using the factors of n = 12 and i = 5% (12 semiannual periods and a semiannual rate of 5%), the factor is 0.5568. You would need to invest $2,784 today ($5,000 ~ 0.5568). Table B.3+Present Value of an Annuity of 1 p= [1 - 1/(1 + i)"]/i Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 15% Periods 1 0.9901 0.9804 0.9709 0.9615 0.9524 0.9346 0.9259 0.9174 0.8929 1 0.9434 1.8334 0.9091 1.7355 2 1.9704 1.9416 1.9135 1.8861 1.8080 1.6901 1.8594 2.7232 2 0.8696 1.6257 2.2832 3 2.9410 2.7751 2.6730 2.6243 1.7591 2.5313 3.2397 2.4869 3 1.7833 2.5771 3.3121 3.9927 2.8839 3.8077 4.7135 2.4018 3.0373 4 3.9020 3.6299 3.5460 3.4651 3.3872 3.1699 4 5 4.8534 4.4518 4.3295 4.2124 4.1002 3.8897 3.7908 3.6048 2.8550 3.3522 3.7845 5 T 6 5.6014 5.2421 4.7665 4.6229 4.3553 4.1114 6 2.8286 3.7171 4.5797 5.4172 6.2303 7.0197 7.7861 8.5302 5.7955 6.7282 7.6517 4.9173 5.5824 4.4859 5.0330 7 5.2064 4.8684 4.5638 4.1604 7 6.0021 6.7327 8 5.3349 4.9676 8 6.4720 7.3255 8.1622 8.9826 6.2098 6.8017 5.3893 5.9713 6.5152 7.0236 5.7466 6.2469 9 8.5660 7.4353 5.0757 5.7864 6.4632 7.1078 7.7217 8.3064 8.8633 9.3936 5.5348 5.9952 6.4177 5.7590 9 10 9.4713 8.1109 6.7101 6.1446 5.3282 5.6502 5.9377 7.3601 7.8869 10 11 10.3676 9.2526 7.4987 6.4951 11 7.1390 7.5361 12 9.9540 4.4873 4.7716 5.0188 5.2337 5.4206 5.5831 5.7245 5.8474 8.7605 9.3851 9.9856 7.9427 6.8137 9.7868 10.5753 11.3484 12.1062 12.8493 6.8052 7.1607 7.4869 11.2551 12.1337 13.0037 6.1944 8.3838 8.8527 13 12 13 7.9038 6.4235 10.6350 11.2961 11.9379 14 7.1034 7.3667 10.5631 8.3577 8.7455 9.1079 9.8986 10.3797 14 9.2950 9.7122 10.1059 8.2442 8.5595 7.7862 8.0607 6.6282 6.8109 15 13.8651 7.6061 15 16 14.7179 13.5777 12.5611 10.8378 9.4466 8.8514 8.3126 7.8237 6.9740 16 5.9542 6.0472 17 14.2919 13.1661 11.2741 10.4773 8.0216 7.1196 17 15.5623 16.3983 17.2260 9.1216 9.3719 18 8.5436 8.7556 8.2014 9.7632 10.0591 10.3356 6.1280 18 14.9920 15.6785 16.3514 11.6896 12.0853 11.1184 11.6523 12.1657 12.6593 13.1339 13.5903 15.6221 17.2920 18.6646 10.8276 11.1581 19 7.2497 7.3658 9.6036 8.9501 8.3649 6.1982 19 20 18.0456 12.4622 11.4699 10.5940 9.8181 9.1285 8.5136 7.4694 6.2593 20 25 19.5235 13.7535 14.3238 14.8775 17.4131 19.6004 21.4872 23.1148 11.6536 10.6748 9.8226 9.0770 6.4641 25 22.0232 25.8077 29.4086 30 12.7834 13.7648 14.0939 15.3725 16.3742 9.4269 22.3965 24.9986 30 12.4090 12.9477 13.3317 10.2737 10.5668 7.8431 8.0552 8.1755 8.2438 11.2578 11.6546 11.9246 35 6.5660 6.6166 14.4982 9.6442 35 40 32.8347 27.3555 19.7928 17.1591 15.0463 10.7574 9.7791 6.6418 40 Used to calculate the present value of a series of equal payments made at the end of each period. For example: What is the present value of $2,000 per year for 10 years assuming an annual interest rate of 9%? For (n = 10, i = 9%), the PV factor is 6.4177. $2,000 per year for 10 years is the equivalent of $12,835 today ($2,000 6.4177)