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Consider the situation in which Jackson wants to earn a return of 8% (YTM), but the bond being considered for purchase offers a coupon rate
Consider the situation in which Jackson wants to earn a return of 8% (YTM), but the bond being considered for purchase offers a coupon rate of 8.00% with a face value of $1,000. Assume that the bond pays semiannual interest payments and has three years to maturity. What is the price of this bond?
| A. | $1,200 | |
| B. | $923 | |
| C. | $846 | |
| D. | $1,000 |
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