Bianca purchased a $5,000 bond that was paying a coupon rate of 4.50% compounded semi-annually and had 7 more years to mature. The yield at the time of purchase was 6.70% compounded semi-annually. a. How much did Bianca pay for the bond?

Bianca purchased a $5,000 bond that was paying a coupon rate of 4.50% compounded semi-annually and had 7 more years to mature. The yield at the time of purchase was 6.70% compounded semi-annually. a. How much did Bianca pay for the bond?

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

Problem 1PS

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Bianca purchased a $5,000 bond that was paying a coupon rate of 4.50% compounded
semi-annually and had 7 more years to mature. The yield at the time of purchase was
6.70% compounded semi-annually.
a. How much did Bianca pay for the bond?
Round to the nearest cent
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