Given the current yield to maturity of the bond, the price of the bond five years for now is $883.10.
<h3>What is the price of the bond five years from now?</h3>
The first step is to determine the yield to maturity of the bond. The yield to maturity is the return on the bond if the bond is held to matuity.
Yield to matuity can be determined using a financial calculator:
Cash flow in year 0 = -875
Cash flow each year from year 1 to 25 = 85
Cash flow in year 25 = $1000
Yield to matuity = 9.86%
Future price of the bond: (coupon x future price factor) + [FV / (1 + YTM)^n)]
Future price factor = [1 - (1/YTM)^n] / YTM
= [1 - 1/0.0986^20] 0.0986 = 8.595555
[85 x 8.595555 ] + 152.478323 = $883.10
To learn more about yield to maturity, please check: brainly.com/question/26484024
I think it is 0.05 but i do if it is right your welcome if it is wrong I'm sorry
It could be 400,000 or 383,000
<span>686.924 to the nearest ten is 690.0 because the ones place is a number of 5 and above, which means you must move the tens place up 1 value.</span>
Answer:
1. C
2. B
3. B
4. A
5. B
Step-by-step explanation:
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