Your broker offers to sell for $1,090 a AAA-rated bond with a coupon rate of 6 percent and a maturity of ten years. Given that the interest rate on comparable debt is 5 percent, calculate the bond's price. Assume that the bond pays interest annually. Use Appendix B and Appendix D to answer the question. Round your answer to the nearest dollar. S Is your broker fairly pricing the bond? -Select-, so the bond -Select be purchased. Should/Should Not Yes/No Interest Factors for the Present Value of One Dollar Interest Factors for the Present Value of an Annuity of One Dollar Time Period (e.g. year) 1 1% 2% 3% 4% 5% 6% .990 1980 .971 962 952 .943 980 1961 .943 925 907 .890 971942 .915 .889 864 840 961 924 .889 .855 .823 .792 951 906 863 822 .784 .747 UT AWN- 7% 8% 9% 10% 12% 14% 15% 935 .926 917 909 .893 .877 870 .873 857 .842 .826 .797 769 .756 .816 .794 .772 .751 712.675.658 .763 .735 .708 .683 636 592 .572 713 .681.650.621 567 519 497 16% .862 .743 .641 552 .476 18% .847 .718 .609 .516 437 20% 24% .833 .806 .694 650 1579524 482 423 402 .341 Time Period (e.g. year) 1 2 3 2 5 28% .781 .610 -477 373 .291 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 14% 16% 18% 20% 24% 28% 32% 36% 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.893 0.877 0.862 0.847 0.833 0.806 0.781 0.758 0.735 1.970 1.942 1.913 1.886 1.859 1.833 1.808 1.783 1.759 1.736 1.690 1.647 1.605 1.566 1.528 1.457 1.392 1.332 1.276 2.941 2.884 2.829 2.775 2.723 2.673 2.624 2.577 2.531 2.487 2.402 2.322 2.246 2.174 2.106 1.981 1.868 1.766 1674 3.902 3.808 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.037 2.914 2.798 2.690 2.589 2.404 2.241 2.096 1.966 4.853 4.713 4.580 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.605 3.433 3.274 3.127 2.991 2.745 2.532 2.345 2.181 6 7 8 9 10 942 888 838 933 871 813 923 .853 .789 914 .837 .766 905 .820 .744 .790 .746 .705 .760 .711 .665 .731 .677 .627 .703 645 592 .676 614 .558 .666 630 596 564 507 456 .623 583 547 513 452 400 .582 540 .502 467 404 351 .544 .500 -460 424 .361 .308 .508 .463 .422 386 322 .270 .432 .376 .327 .284 .247 410 .354 .305 .263 .227 370 314 .266 .226 .191 .335 .279 .233 .194 .162 .275 .222 .179 .144 .116 .227 .178 .139 .108 .085 6 7 8 9 10 5.795 5.601 5.417 5.242 5.076 4.917 4.766 4.623 4.486 4.355 4.111 3.889 3.685 3.498 3.326 3.020 2.759 2.534 2.399 6.728 6.472 6.230 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.564 4.288 4.039 3.812 3.605 3.242 2.937 2.678 2.455 7.652 7.325 7.020 6.733 6.463 6.210 5.971 5.747 5.535 5.335 4.968 4.639 4.344 4.078 3.837 3.421 3.076 2.786 2.540 8.566 8.162 7.786 7.435 7.108 6.802 6.515 6.247 5.985 5.759 5.328 4.946 4.607 4.303 4.031 3.566 3.184 2.868 2.603 9.471 8.983 8.530 8.111 7.722 7.360 7.024 6.710 6.418 6.145 5.650 5.216 4.833 4.494 4.193 3.682 3.269 2.930 2.650 11 12 13 14 15 .896 .887 .879 .870 .861 .804 .788 .773 .758 .743 722 .701 .681 .661 .642 .650 -585 527 .625 .557 497 .601 .530 469 577 505 442 .555 481 417 475 444 415 388 362 429 397 .368 340 315 .388 356 326 .299 .275 .350 319 .290 .263 .239 .287 .237 .257 .208 .229 .182 .205 160 .183 .140 .215 .187 .163 .141 .123 .195 .168 .145 .125 .108 .162 .137 .116 .099 .084 .135 .094 .066 .112 .076 .052 .093 061 .040 .078 .049 .032 .065 .040 .025 11 12 13 12 15 10.368 9.787 9.253 8.760 8.306 7.887 7.499 7.139 6.805 6.495 5.988 5.453 5.029 4.656 4.327 3.776 3.335 2.978 2.683 11.255 10.575 9.954 9.385 8.863 8.384 7.943 7.536 7.161 6.814 6.194 5.660 5.197 4.793 4.439 3.851 3.387 3.013 2.708 12.134 11.348 10.635 9.986 9.394 8.534 8.358 7.904 7.487 7.103 6.424 5.842 5.342 4.910 4.533 3.912 3.427 3.040 2.727 13.004 12.106 11.296 10.563 9.899 9.295 8.745 8.244 7.786 7.367 6.628 6.002 5.468 5.008 4.611 3.962 3.459 3.061 2.740 13.865 12.849 11.938 11.118 10.380 9.712 9.108 8.559 8.060 7.606 6.811 6.142 5.575 5.092 4.675 4.001 3.483 3.076 2.750 16 17 18 19 20 .853 .728 .623 .844 714 .605 .836 700 .587 .828.686 570 .820 .673 .554 .534 .513 494 .475 .456 .458 436 416 396 377 .394 .371 .350 .331 .312 339 .317 .296 .276 .258 .292 .270 .250 .232 .215 .252 .231 .212 .194 .178 .218 .163.123 .107 .198 .146 108 .093 .180 .130.095 .081 .164 .116 .083.070 .149 .104 .073 .061 .093 .080 .069 .060 .051 .071 .060 .051 .043 .037 .054 .032.019 .045 026 015 .038 021 .012 .031 .017 .009 .026 .014 .007 16 17 18 19 20 14.718 13.578 12.561 11.652 10.838 10.106 9.447 8.851 8.312 7.824 6.974 6.265 5.669 5.162 4.730 4.003 3.503 3.088 2.758 15.562 14.292 13.166 12.166 11.274 10.477 9.763 9.122 8.544 8.002 7.120 6.373 5.749 5.222 4.775 4.059 3.518 3.097 2.763 16.398 14 992 13.754 12 659 11690 10.828 10 059 9.372 8.756 8 201 7.250 6.467 5.818 5.273 4.812 4080 3579 3.104 2767 17.225 15.678 14.324 13.134 12.085 11.158 10.336 9.604 8.950 8.365 7.366 6.550 5.877 5.316 4.844 4.097 3.539 3.109 2.770 18.046 16.351 14.877 13.590 12.462 11.470 10.594 9.818 9.128 8.514 7.469 6.623 5.929 5.353 4.870 4.110 3.546 3.113 2.772 25 22.023 19.523 17.413 5.622 14.094 12.783 11.654 10.675 9.823 9.077 7.843 6.873 6.097 5.467 4.948 4.147 3.564 3.122 2.776 25 .780 .610 .478 .375 .295 .233 .184 .146 .116 .092 .059 .038 .030 .024 .016 .010 .005 .002 30 25.808 22.937 19.600 17.292 15.373 13.765 12.409 11.258 10.274 9.427 8.055 7.003 6.177 5.517 4.979 4.160 3.569 3.124 2.778 30 .742 .552 412 308 .231 .174 .131 .099 .075 .057 .033 .020 .015 .012 .007 .004 .002 .001