Compute the price of a $1,000 par value, 9 percent (semi-annual payment) coupon

Question

Compute the price of a $1,000 par value, 9 percent (semi-annual
payment) coupon bond with 23 years remaining until maturity
assuming that the bond's yield to maturity is 19 percent? (Round
your answer to 2 decimal places and record your answer without
dollar sign or commas).
Question 6 options Compute the price of a $1,000 par value, 9 percent (semi-annual
payment) coupon bond with 23 years remaining until maturity
assuming that the bond's yield to maturity is 19 percent? (Round
your answer to 2 decimal places and record your answer without
dollar sign or commas).
Question 6 options Compute the price of a $1,000 par value, 9 percent (semi-annual
payment) coupon bond with 23 years remaining until maturity
assuming that the bond's yield to maturity is 19 percent? (Round
your answer to 2 decimal places and record your answer without
dollar sign or commas).
Compute the price of a $1,000 par value, 9 percent (semi-annual
payment) coupon bond with 23 years remaining until maturity
assuming that the bond's yield to maturity is 19 percent? (Round
your answer to 2 decimal places and record your answer without
dollar sign or commas).

Explanation / Answer

semi annual interest = 1000 * 9% /2 = $45, maturity period = 23 * 2 = 46 and yield to maturity = 9.5%

Price of the bond = $45 * PVIFA(9.5%,46) + 1000 * PVIF(9.5%,46)

= $45 * 10.3644 + 1000 * 0.0154 = $481.80

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