Answered

Looking for trustworthy answers? Westonci.ca is the ultimate Q&A platform where experts share their knowledge on various topics. Explore thousands of questions and answers from a knowledgeable community of experts on our user-friendly platform. Join our platform to connect with experts ready to provide precise answers to your questions in different areas.

Great Wall Pizzeria issued 10-year bonds one year ago at a coupon rate of 6.3 percent. If the YTM on these bonds is 8.5 percent, what is the current bond price

Sagot :

Answer:

the current bond price is $865.38

Explanation:

The computation of the current bond price is shown below:

Given that

NPER is = 10 - 1 = 9

RATE is 8.5%

We assume the future value be $1,000

SO, the coupon i.e. PMT is = $1,000 × 6.3%

the formula is shown below:

=-PV(RATE,NPER,PMT,FV,TYPE)

After applying the above formula, the current bond price is $865.38

View image andromache
We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. We appreciate your time. Please revisit us for more reliable answers to any questions you may have. We're glad you visited Westonci.ca. Return anytime for updated answers from our knowledgeable team.