13. A $70000, 8.5% bond with semi-annual coupons redeemable at par in 12 years is purchased at 102.5.What is the approximate yield rate?14. Can you describe the relationship between bond prices and interest rates? -15. A $9000, 11.5% bond with semi-annual interest coupons redeemahle at par in 17 years is bought toyield 7.5% compounded semi-annually. Determine:(i) the premium or discount(ii) the purchase price

Answered: 13. A $70000, 8.5% bond with…

13. A $70000, 8.5% bond with semi-annual coupons redeemable at par in 12 years is purchased at 102.5. What is the approximate yield rate?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

13. A $70000, 8.5% bond with semi-annual coupons redeemable at par in 12 years is purchased at 102.5.
What is the approximate yield rate?
14. Can you describe the relationship between bond prices and interest rates? -
15. A $9000, 11.5% bond with semi-annual interest coupons redeemahle at par in 17 years is bought to
yield 7.5% compounded semi-annually. Determine:
(i) the premium or discount
(ii) the purchase price

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