Talton buys a $1000 par value 19-year bond with annual coupons. The redemption value at maturity is equal to the par value. Talton bought the bond at a discount to yield an annual effective rate of 6%. Determine the annual coupon rate if the amount for accumulation of discount in the 6th year is 10.04. Possible Answers A 3.73 В 3.79 3.82 D 3.87 E 3.91
Talton buys a $1000 par value 19-year bond with annual coupons. The redemption value at maturity is equal to the par value. Talton bought the bond at a discount to yield an annual effective rate of 6%. Determine the annual coupon rate if the amount for accumulation of discount in the 6th year is 10.04. Possible Answers A 3.73 В 3.79 3.82 D 3.87 E 3.91
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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Transcribed Image Text:Talton buys a $1000 par value 19-year bond
with annual coupons. The redemption value
at maturity is equal to the par value. Talton
bought the bond at a discount to yield an
annual effective rate of 6%.
Determine the annual coupon rate if the
amount for accumulation of discount in the
6th year is 10.04.
Possible Answers
A
3.73
В
3.79
C
3.82
D
3.87
E
3.91
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