Lloyd's of London is selling a perpetual bond that will provide the bondholder with $100 / year forever. The first payment is one year from now. Assuming an interest rate of 5%, what is the value of this bond? a) $2,000 b) $5,000 c) $2,200 d) $4,400
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Lloyd's of London is selling a perpetual bond that will provide the bondholder with $100 / year forever. The first payment is one year from now. Assuming an interest rate of 5%, what is the
a) $2,000
b) $5,000
c) $2,200
d) $4,400
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- You will receive a $60 interest every six months from your investment in a corporate bond. The bond will mature five years from now and it has a face value of $2,000. l11is means that if you hold the bond until its maturity, you will continue to receive $150 interest semiannually and $2,000 face value at the end of five years.(a) What is the present value of the bond in the absence of inflation if the market interest rate is 9% '?(b) What would happen 10 the value of the bond if the inflation rate over the next five years is expected to be 4%?Chuck's of Czechia is selling a perpetual bong that will provide the bondholder with a $50 / year forever. The first payment to the bondholder is later this afternoon and then the following payment is one year from now. Assuming an interest rate of 6%, what is the value of this bond? Choose the closest. a) $666.67 b) $833.33 c) $333.33 d) $883.33a bond pays P340 interest per year and has a face value of P8,328 at the end of 9 years, when it has to be redeemed. If the interest of the bond is 0.19. What is the current value of the bond?
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