You have just purchased a municipal bond with a $10,000 par value for $9,500. You purchased...
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You have just purchased a municipal bond with a $10,000 par value for $9,500. You purchased it immediately after the previous owner received a semiannual interest payment. The bond rate is 6.6% per year payable semiannually. You plan to hold the bond for 3 years, selling the bond immediately after you receive the interest payment. If your desired nominal yield is 10.5% per year compounded semiannually, what will be your minimum selling price for the bond? $ You have just purchased a municipal bond with a $10,000 par value for $9,500. You purchased it immediately after the previous owner received a semiannual interest payment. The bond rate is 6.6% per year payable semiannually. You plan to hold the bond for 3 years, selling the bond immediately after you receive the interest payment. If your desired nominal yield is 10.5% per year compounded semiannually, what will be your minimum selling price for the bond? $
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To calculate the minimum selling price of the bond we need to find the present value of all future c... View the full answer
Related Book For
Operations Management Creating Value Along the Supply Chain
ISBN: 978-0470525906
7th Edition
Authors: Roberta S. Russell, Bernard W. Taylor
Posted Date:
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