62. Annual coupon rate Answer: d Diff: E N
We must solve for the payment and infer the coupon rate from that value. Enter the following data into your financial calculator:
N = 10; I = 9; PV = –903.7351; FV = 1000; and then solve for PMT = $75. Hence, the coupon rate is $75/$1,000 = 7.5%.
63 . Bond value--annual payment Answer: d Diff: E
Enter the following input data in the calculator:
N = 12; I = 8; PMT = 90; FV = 1000; and then solve for PV = -$1,075.36. VB $1,075.
64 . Bond value--semiannual payment Answer: e Diff: E
Financial calculator solution:
Inputs: N = 20; I = 5; PMT = 60; FV = 1000.
Output: PV = -$1,124.62; VB = $1,124.62.
65 . Bond value--semiannual payment Answer: d Diff: E
Financial calculator solution:
Inputs: N = 40; I = 5; PMT = 40; FV = 1000.
Output: PV = -$828.41; VB $828.
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