Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
|
A $1000 bond with semi-annual coupons at j2 = 10% payable January 1 and July 1 each year matures on July 1, 2019, for $1050. |
| a) |
Determine the price on January 1, 2014, to yield j2=1012%j2=1012%. (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
| Price | $ |
| b) | Is the bond purchased at a premium or a discount? | ||||
|
| c) |
Calculate the entries in the bond schedule on July 1, 2014, and January 1, 2015. (Do not round intermediate calculations. Negative answers should be indicated by a minus sign. Round your answers to 2 decimal places.) |
| Bond Interest Payment |
Interest on Book Value |
Book Value Adjustment |
Book Value |
| - | - | - | |
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