If the final expressions in a present value equation used to calculate the price of a bond you are considering buying are "[$50 / (1 +.08) 3] + [$500 / (1 +.08) 3]", which of the following is correct? a. The face value is $500, the coupon is $50, and the coupon will mature in 3 years. b. The face value is $50, the interest rate you need is 8 percent, and the coupon will mature in 3 years. c. The face value is $500, the interest rate you need is 3 percent, and the coupon will mature in 8 years. d. The coupon is $50, the interest rate you need is 1.08 percent, and the coupon will mature in 3 years.
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Home » Business » If the final expressions in a present value equation used to calculate the price of a bond you are considering buying are "[$50 / (1 +.08) 3] + [$500 / (1 +.08) 3]", which of the following is correct? a.