Bond value
Not what you're looking for?
ABC Health Med. has a $1,000 par value bond with an 8 percent rate outstanding. The bond has 12 years remaining to it maturity date. If interest is paid semiannual interest, what is the value of the bond when the required return is 12 percent. Show all work.
Purchase this Solution
Solution Summary
The solution explains how to determine the current value of a bond.
Solution Preview
The value of the bond is the present value of interest and principal discounted at the required return. The semi annual interest is 1,000 X 8%/2 = $40, semi annual periods to maturity are 12X2=24, par value is $1,000 ...
Purchase this Solution
Free BrainMass Quizzes
Team Development Strategies
This quiz will assess your knowledge of team-building processes, learning styles, and leadership methods. Team development is essential to creating and maintaining high performing teams.
Income Streams
In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.
Cost Concepts: Analyzing Costs in Managerial Accounting
This quiz gives students the opportunity to assess their knowledge of cost concepts used in managerial accounting such as opportunity costs, marginal costs, relevant costs and the benefits and relationships that derive from them.
Accounting: Statement of Cash flows
This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.
Motivation
This tests some key elements of major motivation theories.