Suppose a U.S. Treasury bond will pay $1,000 twenty years from now, with no interest payments in between. If the going interest rate on 20-year treasury bonds is 3.31%, how much is the bond worth today?

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
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Suppose a U.S. Treasury bond will pay $1,000 twenty years from now, with no interest payments in between. If the going
interest rate on 20-year treasury bonds is 3.31%, how much is the bond worth today?
Your answer should be between 440.00 and 720.00, rounded to 2 decimal places, with no special characters.
Transcribed Image Text:Suppose a U.S. Treasury bond will pay $1,000 twenty years from now, with no interest payments in between. If the going interest rate on 20-year treasury bonds is 3.31%, how much is the bond worth today? Your answer should be between 440.00 and 720.00, rounded to 2 decimal places, with no special characters.
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