You purchased a bond and will receive $500 every six months for the next five years. If the market rate of interest is 4%, what is the present value of your stream of interest payments? (a stream of equal interest payments is considered an annuity).
You purchased a bond and will receive $500 every six months for the next five years. If the market rate of interest is 4%, what is the present value of your stream of interest payments? (a stream of equal interest payments is considered an annuity).
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 6MC: You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years....
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You purchased a bond and will receive $500
every six months for the next five years. If the market rate
of interest is 4%, what is the present value of your stream of
interest payments? (a stream of equal interest payments is
considered an annuity).
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