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Bond Valuation

You wish to purchase a 20-year, $1,000 face balue bond that makes semiannual interest payments of $40. If you require a 10% nominal yield to maturity, what price should you be willing to pay for the bond?

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You wish to purchase a 20-year, $1,000 face balue bond that makes semiannual interest payments of $40.  If you require a 10% nominal yield to maturity, what price should you be willing to pay for the bond?

To calculate the price of the bond we need to calculate / read from tables the values of
PVIF= Present ...

Solution Summary

Calculates the price of a bond.

$2.19