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A $6,000 bond had a coupon rate of 5.75% with interest paid semi-annually. Bianc purchased this bond when there were 7 years left to maturity and when the marke interest rate was 6.00% compounded semi-annually. He held the bond for 3 years, then sold it when the market interest rate was 5.50% compounded semi-annually. a. What was the purchase price of the bond? Round to the nearest cent.

A $6,000 bond had a coupon rate of 5.75% with interest paid semi-annually. Bianc purchased this bond when there were 7 years left to maturity and when the marke interest rate was 6.00% compounded semi-annually. He held the bond for 3 years, then sold it when the market interest rate was 5.50% compounded semi-annually. a. What was the purchase price of the bond? Round to the nearest cent.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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A $6,000 bond had a coupon rate of 5.75% with interest paid semi-annually. Bianca purchased this bond when there were 7 years left to maturity and when the market interest rate was 6.00% compounded semi-annually. He held the bond for 3 years, then sold it when the market interest rate was 5.50% compounded semi-annually. Hi a. What was the purchase price of the bond? Round to the nearest cent. hp SUBMIT QUESTION SAVE PROGRESS
Transcribed Image Text:A $6,000 bond had a coupon rate of 5.75% with interest paid semi-annually. Bianca purchased this bond when there were 7 years left to maturity and when the market interest rate was 6.00% compounded semi-annually. He held the bond for 3 years, then sold it when the market interest rate was 5.50% compounded semi-annually. Hi a. What was the purchase price of the bond? Round to the nearest cent. hp SUBMIT QUESTION SAVE PROGRESS
b. What was the selling price of the bond? Round to the nearest cent. c. What was Bianca's gain or loss on this investment? (click to select) (click to select) Gain LOSS Im amount was $ SUBMIT QUESTION SAVE PROGRESS
Transcribed Image Text:b. What was the selling price of the bond? Round to the nearest cent. c. What was Bianca's gain or loss on this investment? (click to select) (click to select) Gain LOSS Im amount was $ SUBMIT QUESTION SAVE PROGRESS
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