Chapter 6, Problem 15P

Summary Introduction

Bonds at discount:

When bonds are traded at a price less than its face value or par value, then it is known as bonds at discount.

Bonds at premium

When bonds are traded at a price above its face value or par value, then it is known as bonds at a premium.

Bonds at par

When bonds are traded at a price equal to its face value or par value.

To determine:

The prices of bonds, each with a face value of $1000.