Suppose that a 30-year municipal bond has a maturity value of $5000 and a coupon rate of

Question:

Suppose that a 30-year municipal bond has a value of $5000 and a rate of 8%, with coupons paid semiannually. Find the market price of the bond if the current yield rate is 10% compounded semiannually. Is this bond selling at a discount or at a premium?
Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a... 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...