You have paid $1,063 for a bond with 9 years remaining to maturity. Interest on the bond is paid semiannually. If current rate of return for similar investments is a nominal 8%, what is this bond's coupon rate? Round answer to two decimal places.
Please provide formulas (not excel)© BrainMass Inc. brainmass.com June 4, 2020, 12:35 am ad1c9bdddf
The price paid is the present value of coupon interest and principal. By equating the PV of interest and principal such that it is equal to the price, we can ...
The solution explains how to determine the bond coupon rate.