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    Calculate Bond Face Value

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    Please help with the following problem. Provide calculations and explanations.

    1. How much should a $1,000-face-value bonds sell for, assuming the following conditions:
    - The bond pays a coupon of 11%
    - The coupon payments are paid annually.
    - The required rate of return on similar-risk investments is 9%.
    - The bond matures in 15 years

    2. How much should a $1,000-face-value bonds sell for, assuming the following conditions:
    - The bond pays a coupon of 7%
    - The coupon payments are paid semi-annually.
    - The required rate of return on similar-risk investments is 7%.
    - The bond matures in 10 years

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    https://brainmass.com/business/business-math/calculate-bond-face-value-103246

    Solution Preview

    1. First, we need to calculate how much the bonds have been issued by using the formula as follows:
    where B is the issued price
    C is the coupon payment
    r is the effective rate
    n is the period

    However, in order to calculate the price of the bond, ...

    Solution Summary

    This posting helps with business math. The solution helps calculate bond face value. Calculations are provided along with explanations.

    $2.19

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