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    Current Value of a Bond

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    What is the current value of a bond with a coupon rate of 5%, 10 years to maturity, $1000 par value and YTM of 6%?

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    Solution Preview

    What is the current value of a bond with a coupon rate of 5%, 10 years to maturity, $1000 par value and YTM of 6%?

    We can assume semi annual payment of coupon as this fact is not mentioned
    Most bonds have semi annual coupon/ interest payments

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

    Solution Summary

    This solution computes the current value of a bond that has a coupon rate of 5%.

    $2.19

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