Question Two: (25 marks) An annual bond has a face value of $1,000, makes an annual coupon

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Question Two: (25 marks)

An annual bond has a face value of $1,000, makes an annual coupon payment of $25 per year, has a discount rate per year of 9.0%, and has 8 years to maturity. Calculate the bond price in three equivalent ways.

First, calculate the bond price as the present value of the bond's cash
flows the long way
Second, use a formula for the bond price.
Third, use Excel's PV function for a bond price.

Related Book For answer-question

Corporate Finance

ISBN: 9781265533199

13th International Edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe

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Posted Date: May 18, 2024 09:17 PM

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Question Two: (25 marks) An annual bond has a face value of $1,000, makes an annual coupon

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Corporate Finance

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