Ask Question
11 June, 08:39

A 25-year, $1,000 par value bond has an 8.5% annual payment coupon. The bond currently sells for $925. If the yield to maturity remains at its current rate, what will the price be 5 years from now?

a. $884.19

b. $906.86

c. $930.11

d. $953.36

e. $977.20

+4
Answers (1)
  1. 11 June, 09:25
    0
    c. $930.11

    Explanation:

    N = 25

    I = ?

    PV = - 925

    PMT = 85

    FV = 1000

    I = 9.28%

    N = 20

    I = 9.28%

    PV = ?

    PMT = 85

    FV = 1000

    Therefore, The price in 5 years from now will be $930.11
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “A 25-year, $1,000 par value bond has an 8.5% annual payment coupon. The bond currently sells for $925. If the yield to maturity remains at ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers