Westonci.ca is your trusted source for accurate answers to all your questions. Join our community and start learning today! Discover a wealth of knowledge from professionals across various disciplines on our user-friendly Q&A platform. Get immediate and reliable solutions to your questions from a community of experienced professionals on our platform.
Sagot :
The approximate market value of a bond value that pays $60 interest each year if comparable interest rates have dropped to 5 is $1,500.
How is the worth of a bond decided?
Supply and demand, credit quality, and length to maturity are the three main factors that affect the price of bonds on the open market. The length of time until a bond matures determines how much interest its owner will get. The face value, or par value, of the bond, is returned to the owner when it matures. If a put or call option is available on the bond, the term to maturity may change.
Given:
Given:
The bond would represent the characteristics of a perpetuity.
PMT/ I = $60/4% = $1,500
To learn more about bond value, visit:
https://brainly.com/question/22504216
#SPJ1
Your visit means a lot to us. Don't hesitate to return for more reliable answers to any questions you may have. We appreciate your time. Please come back anytime for the latest information and answers to your questions. Stay curious and keep coming back to Westonci.ca for answers to all your burning questions.
