Compute the price of the bonds based on semiannual analysis.

Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
Chapter11: Bond Pricing And Amortization (bonds)
Section: Chapter Questions
Problem 7R
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Heather Smith is considering a bond investment in Locklear Airlines. The $1,000 par value bonds have a quoted annual interest rate of
9 percent and the interest is paid semiannually. The yield to maturity on the bonds is 12 percent annual interest. There are 9 years to
maturity.
Compute the price of the bonds based on semiannual analysis. Use Appendix B and Appendix D for an approximate answer but
calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your
final answer to 2 decimal places.)
Bond price
Transcribed Image Text:Heather Smith is considering a bond investment in Locklear Airlines. The $1,000 par value bonds have a quoted annual interest rate of 9 percent and the interest is paid semiannually. The yield to maturity on the bonds is 12 percent annual interest. There are 9 years to maturity. Compute the price of the bonds based on semiannual analysis. Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Bond price
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