A $4,000 bond that has a coupon rate of 5.20% payable semi-annually and maturity of 8 years was purchased when the yield was 4.10% compounded semi-annually. What was the book value of the bond after 12 payments? $0.00 Round to the nearest cent

A $4,000 bond that has a coupon rate of 5.20% payable semi-annually and maturity of 8 years was purchased when the yield was 4.10% compounded semi-annually. What was the book value of the bond after 12 payments? $0.00 Round to the nearest cent

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

Problem 7P: Bond Valuation with Semiannual Payments Renfro Rentals has issued bonds that have a 10% coupon rate,...

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Concept explainers

Bond Valuation

Bond valuation are the notes issued by the corporation to raise long-term funds for the business. The corporations are required to pay the interest on such liabilities at a specified rate of interest (termed as coupon rate) at specified dates which may be on semi-annual or annual basis. These interest payments may be in the form of coupons.

Question

A $4,000 bond that has a coupon rate of 5.20% payable semi-annually and maturity of 8
years was purchased when the yield was 4.10% compounded semi-annually. What was
the book value of the bond after 12 payments?
$0.00
Round to the nearest cent

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