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Denis purchased a $10.000 face value Ontario Hydro Energy bond maturing in four years. The coupon rate was 8% payable semiannually. f the prevailing market rate at the time of purchase was 74% compounded semiannually, what price did Denis pay for the bond? (Do not round the intermediete calculations. Round your final answer to 2 decimal pleces) Assume that • Bond interest s paid semiannually • The bond was onginally issued at its face value - Bonds are redeemed at their face value at maturity - Market rates of return are compounded semiannually. Bond price

Denis purchased a $10.000 face value Ontario Hydro Energy bond maturing in four years. The coupon rate was 8% payable semiannually. f the prevailing market rate at the time of purchase was 74% compounded semiannually, what price did Denis pay for the bond? (Do not round the intermediete calculations. Round your final answer to 2 decimal pleces) Assume that • Bond interest s paid semiannually • The bond was onginally issued at its face value - Bonds are redeemed at their face value at maturity - Market rates of return are compounded semiannually. Bond price

FINANCIAL ACCOUNTING
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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Denis purchased a $10.000 face value Ontario Hydro Energy bond maturing in four years. The coupon rate was 8% payable semiannually. f the prevailing market rate at the time of purchase was 74% compounded semiannually, what price did Denis pay for the bond? (Do not round the intermediete calculations. Round your final answer to 2 decimal places) Assume that • Bond interest s paid semiannually The bond was originallyissued at its face value · Bonds are redeemed at their face value at maturity Market rates of return are compounded semiannually Bond price
Transcribed Image Text:Denis purchased a $10.000 face value Ontario Hydro Energy bond maturing in four years. The coupon rate was 8% payable semiannually. f the prevailing market rate at the time of purchase was 74% compounded semiannually, what price did Denis pay for the bond? (Do not round the intermediete calculations. Round your final answer to 2 decimal places) Assume that • Bond interest s paid semiannually The bond was originallyissued at its face value · Bonds are redeemed at their face value at maturity Market rates of return are compounded semiannually Bond price
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