Guggenheim offers a bond with annual payments and a coupon rate of 5 percent. The yield to maturity is 5.62 percent and the matu
rity date is 9 years away. What is the market price of a $1,000 face value bond?
1 answer:
Answer:
$957.12
Explanation:
In this question we have used the formula of the present value which is shown in the attachment
The NPER is a time period and the PMT is the monthy payments
Provided that,
Future value = $1,000
Rate of interest = 5.62%
NPER = 9 years
PMT = $1,000 × 5% = $50
The formula is shown below:
= -PV(Rate;NPER;PMT;FV;type)
So, after solving this, the answer is $957.12
You might be interested in