Emily purchased a bond valued at $10,000 for highway construction for $4,540. If the bond pays 7.9% annual interest compounded monthly, how long must she hold it until it reaches its full face value? She must hold onto the bond for years. (Round to two decimal places as needed.)

Emily purchased a bond valued at $10,000 for highway construction for $4,540. If the bond pays 7.9% annual interest compounded monthly, how long must she hold it until it reaches its full face value? She must hold onto the bond for years. (Round to two decimal places as needed.)

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

ChapterM: Time Value Of Money Module

Section: Chapter Questions

Problem 11RE: Samuel Ames owes 20,000 to a friend. He wants to know how much he would have to pay if he paid the...

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Concept explainers

Amortized Loans

The term "amortization" refers to spreading the value of a loan or a debt over a series of regular payments or installments comprising of both the principal and interest amount. It generally involves the process where in the value of a loan or an intangible asset is written down over its maturity period.

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Emily purchased a bond valued at $10,000 for highway construction for $4,540.
If the bond pays 7.9% annual interest compounded monthly, how long must she
hold it until it reaches its full face value?
She must hold onto the bond for years.
(Round to two decimal places as needed.)
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