Buner Corp.s outstanding bond has the following characteristics: Years to maturity 6.0 Coupon rate of interest

Question:

Buner Corp.’s outstanding bond has the following characteristics:

Years to maturity ………………………… 6.0

Coupon rate of interest ………………….. 8.0%

Face value ……………………………….. $1,000

If investors require a rate of return equal to 12 percent on similar risk bonds and interest is paid semiannually, what should be the market price of Buner’s bond?

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...