Nikita Enterprises has bonds on the market making annual payments, with eleven years to maturity, a par value of $1,000, and selling for $970. At this price, the bonds yield 7 percent. What must the coupon rate be on the bonds? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Nikita Enterprises has bonds on the market making annual payments, with eleven years to maturity, a par value of $1,000, and selling for $970. At this price, the bonds yield 7 percent. What must the coupon rate be on the bonds? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
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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![Problem 7-5 Coupon Rates [LO2]
Nikita Enterprises has bonds on the market making annual payments, with eleven years
to maturity, a par value of $1,000, and selling for $970. At this price, the bonds yield 7
percent. What must the coupon rate be on the bonds? (Do not round intermediate
calculations and enter your answer as a percent rounded to 2 decimal places, e.g.,
32.16.)
Answer is complete but not entirely correct.
Coupon rate
1.92 X %](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe5afe689-48f9-48be-8b74-c32618974e20%2Fc41f11d2-65a2-492c-a34f-2ef33d3c5f76%2Fajb1qoi_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 7-5 Coupon Rates [LO2]
Nikita Enterprises has bonds on the market making annual payments, with eleven years
to maturity, a par value of $1,000, and selling for $970. At this price, the bonds yield 7
percent. What must the coupon rate be on the bonds? (Do not round intermediate
calculations and enter your answer as a percent rounded to 2 decimal places, e.g.,
32.16.)
Answer is complete but not entirely correct.
Coupon rate
1.92 X %
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