Question
What is the present value (aka price) of a 26-year, pure discount bond (zero coupon bond) that pays $1100 at maturity if it is priced
What is the present value (aka price) of a 26-year, pure discount bond (zero coupon bond) that pays $1100 at maturity if it is priced to yield 8.09% per year (YTM)? Answer to 2decimal places.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
To calculate the present value price of a pure discount bond we can use the formula Price Face V...
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Step: 2
Step: 3
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Intermediate Microeconomics
Authors: Hal R. Varian
9th edition
978-0393123975, 393123979, 393123960, 978-0393919677, 393919676, 978-0393123968
