You are considering a 15-year, $1,000 par value bond. Its coupon rate is 11%, and interest is paid semiannually. If you require an "effective" annual interest rate (not a nominal rate) of 7.25%, how much should you be willing to pay for the bond? Do not round intermediate steps. Round your answer to the nearest cent.

You are considering a 15-year, $1,000 par value bond. Its coupon rate is 11%, and interest is paid semiannually. If you require an "effective" annual interest rate (not a nominal rate) of 7.25%, how much should you be willing to pay for the bond? Do not round intermediate steps. Round your answer to the nearest cent.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 11P

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