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Black_prince [1.1K]
2 years ago
14

Lincoln Park Co. has a bond outstanding with a coupon rate of 5.73 percent and semiannual payments. The yield to maturity is 6.7

percent and the bond matures in 23 years. What is the market price if the bond has a par value of $2,000?
Business
1 answer:
Natalija [7]2 years ago
5 0

Answer:

Bond Price​= $1,774.05

Explanation:

Giving the following information:

Coupon rate= 0.0573/2= 0.02865

YTM= 0.067/2= 0.0335

The bond matures in 23 years.

Par value= $2,000

<u>To calculate the bond price, we need to use the following formula:</u>

Bond Price​= cupon*{[1 - (1+i)^-n] / i} + [face value/(1+i)^n]

Bond Price​= 57.3*{[(1 - (1.0335^-46)] / 0.0335} + [2,000/1.0335^46]

Bond Price​= 1,334.76 + 439.29

Bond Price​= $1,774.05

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The question is incomplete. The complete question is as follows,

At December 31, 2011 the accounting records of Gordon, Inc. contain the following items:

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Answer:

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The accounting equation states that the sum of total assets is always equal to the sum of total liabilities plus total equity. We can state the equation as follows,

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3 years ago
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