Explore BrainMass

Explore BrainMass

    Bear Corporation issued 20 year bond 5 years ago.

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Bear Corporation issued 20 year bond 5 years ago. The bonds have a contract rate of 12 percent with interest paid semiannually and a par value of $1,000. If you require a return of 14 percent on these bonds, how much would you pay for one these bonds today?

    © BrainMass Inc. brainmass.com June 3, 2020, 11:31 pm ad1c9bdddf
    https://brainmass.com/business/bond-valuation/bear-corporation-issued-year-bond-years-ago-283011

    Solution Preview

    Semi Annual Payments = 12%/2 x 1000 = $60

    PV of $60 paid semi annualy at 14% interest rate =

    PVoa = ...

    Solution Summary

    The expert examines Bear Corporation issued over 2 year bonds 5 years ago.

    $2.19

    ADVERTISEMENT