Question
Suppose a two-year coupon bond has payments of $40 once per year. It has a face value of $800. The yield to maturity is 8%.
Suppose a two-year coupon bond has payments of $40 once per year. It has a face value of $800. The yield to maturity is 8%.
a) Compute the present value of the coupon payments of the bond.
b) Compute the present value of the principal payment of the bond.
c) What is the price of this bond?
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Focus On Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert Hughes
3rd Edition
0073382426, 9780073382425
