You have a chance to buy a corporate bond. Here are the details: Years until maturity = 10 Annual interest income = $100/year (assume end of the year) Par value paid to you when the bond matures in 10 years = $1,000 Assume the interest is paid yearly. Market rates are currently 12% and coupon rate is 10% What is this bond's value? Group of answer choices $228.91 $ 886.99 $1,132.97 $100.00
You have a chance to buy a corporate bond. Here are the details: Years until maturity = 10 Annual interest income = $100/year (assume end of the year) Par value paid to you when the bond matures in 10 years = $1,000 Assume the interest is paid yearly. Market rates are currently 12% and coupon rate is 10% What is this bond's value? Group of answer choices $228.91 $ 886.99 $1,132.97 $100.00
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:You have a chance to buy a corporate bond. Here are
the details: Years until maturity = 10 Annual interest
income = $100/year (assume end of the year) Par
value paid to you when the bond matures in 10 years
= $1,000 Assume the interest is paid yearly. Market
rates are currently 12% and coupon rate is 10% What is
this bond's value? Group of answer choices $228.91 $
886.99 $1,132.97 $100.00
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