What is the semiannual interest payments of a 30 year bond with a face value of $50 million and a stated annual interest rate of

Question

2 years ago

11

4 percent?

1 answer:

Snowcat [4.5K] · Answer 1 · 2023-09-02T01:41:33+03:00

Based on the stated annual interest rate and the face value of the bond, the semiannual payments will be $1,000,000.

<h3>How can the semiannual interest payment be found?</h3>

The formula to find the semiannual payment is:

= (Face value x Stated annual interest rate) / 2 semi-annual periods per year

Solving gives:

= (50,000,000 x 4%) / 2

= 2,000,000 / 2

= $1,000,000

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