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    Zero coupon bonds

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    Three years ago, the firm issues 300,000 30 year, zero coupon bonds. The bonds have a face value of $1,000 and originally sold for $76.45. Currently, the bonds sell for $97.61.

    What is the combined Market Value of the Zero Coupon Bonds today?

    What is the Yield on the Zero Coupon Bonds. Remember = these are 30 year bonds but were issued THREE years ago (hint-what is "n"?)

    © BrainMass Inc. brainmass.com December 15, 2020, 5:46 pm ad1c9bdddf

    Solution Preview

    Market value = Number of bonds X Price per Bond
    Combined market value = 300,000 bonds X $97.61 per bond = ...

    Solution Summary

    The solution explains how to calculate the price and yield on a zero coupon bond