n 1% 2% 3% 1 0.9901 0.9804 0.9709 2 0.9803 0.9612 3 0.9706 4 0.9610 5 0.9515 6 0.9420 7 0.9327 Known Future Single Lump Sum) 0.9423 0.9151 0.8885 0.9238 0.9057 0.8626 4% 5% 6% 7% 8% 0.9615 0.9524 0.9434 0.9346 0.9259 0.9174 0.9091 0.9009 0.9426 0.9246 0.9070 0.8900 0.8734 0.8573 0.8417 0.8264 0.8116 0.8890 0.8638 0.8396 0.8163 0.7938 0.7722 0.7513 0.7312 0.8548 0.8227 0.7921 0.7629 0.7350 0.7084 0.6830 0.8219 0.7835 0.7473 0.7130 0.6806 0.6499 0.6209 0.7903 0.7462 0.7050 0.6663 0.6302 0.5963 0.5645 0.7599 0.7107 0.6651 0.6227 0.5835 0.5470 0.5132 0.8535 0.7894 0.7307 0.6768 0.6274 0.5820 0.5403 0.5019 0.4665 0.8368 0.7664 0.7026 0.6446 0.5919 0.5439 0.5002 0.4604 0.4241 0.4632 0.4224 0.3855 0.4289 0.3875 0.3505 0.3971 0.3555 0.3186 0.8880 0.8375 0.8706 0.8131 8 0.9235 10 9 0.9143 0.9053 0.8203 0.7441 0.6756 0.6139 0.5584 0.5083 0.8963 0.8043 0.7224 0.6496 0.5847 0.5268 0.4751 12 0.8874 0.7885 0.7014 0.6246 0.5568 0.4970 04440 11 14% 15% 16% 9% 10% 11% 12% 13% 0.8929 0.8850 0.8772 0.8696 0.8621 0.7972 0.7831 0.7695 0.7561 0.7432 0.7118 0.6931 0.6750 0.6575 0.6407 0.6587 0.6355 0.6133 0.5921 0.5718 0.5523 0.4251 0.3996 0.3759 0.5935 0.5674 0.5428 0.5194 0.4972 0.5346 0.5066 0.4803 0.4556 0.4323 0.4817 0.4523 0.4339 0.4039 0.3762 0.3506 0.3269 0.3909 0.3606 0.3329 0.3522 0.3220 0.2946 0.3173 0.2875 0.2607 0.2858 0.2567 0.2307 0.4761 0.4104 0.3538 0.3050 0.3075 0.2843 0.2630 0.2697 0.2472 0.2267 0.2366 0.2149 0.1954 0.2076 0.1869 0.1685 17% 0.8547 0.7305 0.6244 0.5337 0.4561 0.3898 0.3332 0.2848 0.2434 0.2080 0.1778 0.1520
n 1% 2% 3% 1 0.9901 0.9804 0.9709 2 0.9803 0.9612 3 0.9706 4 0.9610 5 0.9515 6 0.9420 7 0.9327 Known Future Single Lump Sum) 0.9423 0.9151 0.8885 0.9238 0.9057 0.8626 4% 5% 6% 7% 8% 0.9615 0.9524 0.9434 0.9346 0.9259 0.9174 0.9091 0.9009 0.9426 0.9246 0.9070 0.8900 0.8734 0.8573 0.8417 0.8264 0.8116 0.8890 0.8638 0.8396 0.8163 0.7938 0.7722 0.7513 0.7312 0.8548 0.8227 0.7921 0.7629 0.7350 0.7084 0.6830 0.8219 0.7835 0.7473 0.7130 0.6806 0.6499 0.6209 0.7903 0.7462 0.7050 0.6663 0.6302 0.5963 0.5645 0.7599 0.7107 0.6651 0.6227 0.5835 0.5470 0.5132 0.8535 0.7894 0.7307 0.6768 0.6274 0.5820 0.5403 0.5019 0.4665 0.8368 0.7664 0.7026 0.6446 0.5919 0.5439 0.5002 0.4604 0.4241 0.4632 0.4224 0.3855 0.4289 0.3875 0.3505 0.3971 0.3555 0.3186 0.8880 0.8375 0.8706 0.8131 8 0.9235 10 9 0.9143 0.9053 0.8203 0.7441 0.6756 0.6139 0.5584 0.5083 0.8963 0.8043 0.7224 0.6496 0.5847 0.5268 0.4751 12 0.8874 0.7885 0.7014 0.6246 0.5568 0.4970 04440 11 14% 15% 16% 9% 10% 11% 12% 13% 0.8929 0.8850 0.8772 0.8696 0.8621 0.7972 0.7831 0.7695 0.7561 0.7432 0.7118 0.6931 0.6750 0.6575 0.6407 0.6587 0.6355 0.6133 0.5921 0.5718 0.5523 0.4251 0.3996 0.3759 0.5935 0.5674 0.5428 0.5194 0.4972 0.5346 0.5066 0.4803 0.4556 0.4323 0.4817 0.4523 0.4339 0.4039 0.3762 0.3506 0.3269 0.3909 0.3606 0.3329 0.3522 0.3220 0.2946 0.3173 0.2875 0.2607 0.2858 0.2567 0.2307 0.4761 0.4104 0.3538 0.3050 0.3075 0.2843 0.2630 0.2697 0.2472 0.2267 0.2366 0.2149 0.1954 0.2076 0.1869 0.1685 17% 0.8547 0.7305 0.6244 0.5337 0.4561 0.3898 0.3332 0.2848 0.2434 0.2080 0.1778 0.1520
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
Related questions
Question
Transcribed Image Text:Appendix A-2 Present Value of a Single Amount ($1) (Used to Compute the Discounted Present Value of Some
Known Future Single Lump Sum)
20%
1% 2% 3% 4% 5% 6%
1 0.9901 0.9804 0.9709 0.9615 0.9524 0.9434
2 0.9803 0.9612
0.9426 0.9246 0.9070 0.8900
3 0.9706 0.9423 0.9151 0.8890 0.8638
4 0.9610 0.9238 0.8885 0.8548 0.8227
0.8219 0.7835
0.7903 0.7462
0.8333
0.6944
0.5787
0.4823
5
0.9515 0.9057 0.8626
0.8375
0.7084 0.6830
0.6499 0.6209
0.5963 0.5645
0.5132
6 0.9420 0.8880
0.6227
0.5835
0.5470
7 0.9327 0.8706 0.8131 0.7599 0.7107
0.9235
8
0.6274
0.5820
0.50 19
0.4665
0.4339
0.5919 0.5439
0.4604
10
0.9143
0.9053
0.8963
11
15
7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19%
0.9346 0.9259 0.9174 0.9091 0.9009 0.89 29 0.8850 0.8772 0.8696 0.8621 0.8547 0.8475 0.8403
0.8734
0.8573 0.8417 0.8264 0.8116 0.7972
0.7831
0.7695 0.7561 0.7432 0.7305 0.7182 0.7062
0.8396 0.8163 0.7938 0.7722 0.7513
0.7312 0.71 18 0.6931 0.6750 0.6575 0.6407 0.6244 0.6086 0.5934
0.7921 0.7629 0.7350
0.6587 0.6355
0.6133 0.5921 0.5718 0.5523 0.5337 0.5158 0.4987
0.7473 0.7130 0.6806
0.5935 0.5674 0.5428 0.5194 0.4972 0.4761 0.4561 0.4371 0.4190 0.4019
0.7050 0.6663 0.6302
0.5346 0.5066 0.4803 0.4556 0.4323 0.4104 0.3898 0.3704 0.3521 0.3349
0.6651
0.4817 0.4523 0.4251 0.3996 0.3759 0.3538 0.3332 0.3139 0.2959 0.2791
0.8535 0.7894 0.7307 0.6768
0.5403
0.4039 0.3762 0.3506 0.3269 0.3050 0.2848 0.2660 0.2487 0.2326
0.8368 0.7664 0.70 26 0.6446
0.5002
0.4241 0.3909 0.3606 0.3329 0.3075 0.2843 0.2630 0.2434 0.2255 0.2090 0.1938
0.8203 0.7441 0.6756 0.6139 0.5584 0.5083 0.4632 0.4224 0.3855 0.3522 0.3220 0.2946 0.2697 0.2472 0.2267 0.2080 0.1911 0.1756 0.1615
0.8043 0.7224 0.6496 0.5847 0.5268 0.4751 0.4289 0.3875 0.3505 0.3173 0.2875 0.2607 0.2366 0.2149 0.1954 0.1778 0.1619 0.1476 0.1346
12 0.8874 0.7885 0.7014 0.6246 0.5568 0.4970 0.4440 0.3971 0.3555 0.3186 0.2858 0.2567 0.2307 0.2076 0.1869 0.1685 0.1520 0.1372 0.1240 0.1122
13 0.8787 0.7730 0.6810 0.6006 0.5303 0.4688 0.4150 0.3677 0.3262 0.2897 0.2575 0.2292 0.2042 0.1821 0.1625 0.1452 0.1299 0.1163 0.1042 0.0935
14 0.8700 0.7579 0.6611 0.5775 0.5051 0.4423 0.3878 0.3405 0.2992 0.2633 0.2320 0.2046 0.1807 0.1597 0.1413 0.1252 0.1110 0.0985 0.0876 0.0779
0.8613 0.7430 0.6419 0.5553 0.48 10
0.3624 0.3152 0.2745 0.2394 0.2090 0.1827 0.1599 0.1401 0.1229 0.1079 0.0949 0.0835 0.0736 0.0649
0.85 28 0.7284
0.4581
0.3387 0.2919 0.2519 0.2176 0.1883 0.1631 0.1415 0.1229 0.1069 0.0930 0.0811 0.0708 0.0618
0.7142
0.4363 0.3714 0.3166 0.2703 0.2311 0.1978 0.1696 0.1456 0.1252 0.1078 0.0929 0.0802 0.0693 0.0600 0.05.20 0.0451
0.4155 0.3503
0.2120 0.1799 0.1528 0.1300 0.1108 0.0946 0.0808 0.0691 0.0592 0.0508 0.0437 0.0376
0.3957 0.3305 0.2765
0.1945 0.1635 0.1377 0.1161 0.0981 0.0829 0.0703 0.0596 0.0506 0.0431 0.0367 0.0313
0.3769
0.1486 0.1240 0.1037 0.0868 0.0728 0.0611 0.0514 0.0433 0.0365 0.0308 0.0261
0.3589 0.2942 0.2415 0.1987 0.1637 0.1351 0.1117 0.0926 0.0768 0.0638 0.0531 0.0443 0.0370 0.0309 0.0259 0.0217
0.3418 0.2775 0.2257 0.1839 0.1502 0.1228 0.1007 0.0826 0.0680 0.0560 0.0462 0.0382 0.03 16 0.0262 0.0218 0.0181
0.3256 0.2618 0.2109 0.1703 0.1378
0.1117 0.0907 0.07 38 0.0601 0.0491 0.0402 0.03 29 0.0270 0.0222 0.0183 0.0151
0.3101 0.2470 0.1971 0.1577 0.1264 0.1015 0.0817 0.0659 0.0532 0.0431 0.0349 0.0284 0.0231 0.0188 0.0154 0.0126
0.1160 0.0923 0.0736 0.0588 0.0471 0.0378 0.0304 0.0245 0.0197 0.0160 0.0129
0.1064 0.0839 0.0663 0.0525 0.0417 0.0331 0.0264 0.0211 0.0169 0.0135 0.0109
0.0976 0.0763 0.0597 0.0469 0.0369 0.0291 0.0230 0.0182
0.1159 0.0895 0.0693 0.0538 0.0419 0.03 26 0.0255 0.0200 0.0157
0.1073 0.0822 0.0630 0.0485 0.0374
0.0224 0.0174 0.0135
0.1314 0.0994 0.0754 0.0573 0.0437 0.0334 0.0256 0.0196 0.0151 0.0116
0.0460 0.0318 0.0221 0.0154 0.0107 0.0075 0.0053 0.0037 0.0026
0.0134 0.0085 0.0054 0.0035 0.0022 0.0014 0.0009 0.0006
0.4173
0.3936
16
0.0541
0.6232 0.5339
0.6050 0.5134
18 0.8360 0.7002 0.5874 0.4936
19 0.8277 0.6864 0.5703 0.4746
0.4564
17 0.8444
0.2959
0.2502
0.2317
0.3118 0.2584 0.2145 0.1784
20 0.8195 0.6730 0.5537
21 0.8114 0.6598 0.5375
0.5219
0.4388
22 0.8034 0.6468
0.4220
0.5067
0.4057
0.4919 0.3901
0.4776
0.0105
0.3751
0.3607
0.4637
0.1842 0.1460
0.1722 0.1352
0.1609 0.1252
0.3468
0.4502
0.5744 0.4371 0.3335
0.5631 0.4243 0.3207
0.5521
0.2953 0.2330
0.2812 0.2198
0.2678 0.2074
0.2551 0.1956 0.1504
0.2429 0.1846 0.1406
0.1741
0.0972
0.0289
0.0087
0.0144 0.0115 0.0091 0.0073
0.0123 0.0097 0.0077 0.0061
0.0105 0.0082 0.0064 0.0051
0.0090 0.0070 0.0054 0.0042
0.0019 0.0013 0.0010 0.0007
0.0002 0.0001
0.4120
0.3083
0.2314
0.4529 0.3066
0.2083
0.1420
0.0668
0.2281
0.1407
0.0872
0.0543
0.0339
0.0213
0.0004 0.0003
n
9
23 0.7954
24 0.7876
0.6342
0.6217
0.7798 0.6095
0.7720 0.5976
25
26
27 0.7644 0.5859
28 0.7568
0.7493
0.7419
0.6717
29
30
40
50 0.6080 0.3715
Transcribed Image Text:Market Price
What is the market price of a $1,000, 5 percent bond paying a semiannual coupon if comparable market interest rates rise to 12 percent and the bond matures in 14 years? Round your answer to the nearest dollar. (Hint: Use Appendix A-2 and Appendix A-4.)
Round Present Value of a Single Amount and Present Value of a Series of Equal Amounts in intermediate calculations to four decimal places.
$
Expert Solution
Step 1
Price of bond is the present value of the coupon payment and present value of the par value of the bond based on interest rate in the market and period of maturity.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education