1. What is the price of a $1,000 bond with a coupon payment of $50 annually if the bond matures in 2 years and the prevailing market interest rate is 4 percent? a. $920.9 b. $980.9 c. $1,018.9 d. $1,080.9

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter4: Bond Valuation
Section: Chapter Questions
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1. What is the price of a $1,000 bond with a coupon payment of $50 annually if the bond matures
in 2 years and the prevailing market interest rate is 4 percent?
a. $920.9
b. $980.9
c. $1,018.9
d. $1,080.9
Transcribed Image Text:1. What is the price of a $1,000 bond with a coupon payment of $50 annually if the bond matures in 2 years and the prevailing market interest rate is 4 percent? a. $920.9 b. $980.9 c. $1,018.9 d. $1,080.9
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