You are about to purchase a $1,000 face value bond (today, October 23, 2011) which currently has

Question:

You are about to purchase a $1,000 face value bond (today, October 23, 2011) which currently has 7 years to maturity (so the maturity date is 10/23/2018). The coupon, or interest, payments on this particular bond are $75 per year. If current interest rates (or the yield to maturity) on a security of identical risk and maturity as this particular bond are 9 percent annually (rd = 9%), how much will you have to pay for this bond today (VB on 10/23/2011)?

Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...