A phone call to a government official by an employee of the enron corporation disclosed the deception and dishonesty of the firm
1 answer:
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Answer:
Present value of zero coupon bond = $283
Explanation:
Provided that zero coupon bonds are to be issued.
In zero coupon bonds issue price is less than face value to meet the needs.
Interest rate = 13%
Duration = 10 years, Paid semiannually.
Thus periods = 20
Interest rate =
Therefore, Present value factor @6.5% for 20 periods = 0.283
Therefore, Value of bond today = $1,000 0.283 = $283