What would you pay for a $125,000 debenture bond that matures in 15 years and pays $6,250 a year in interest if you wanted to earn a yield of: 2%
Added by Cassandra S.
Step 1
The present value formula is: PV = C * (1 - (1 + r)^-n) / r Where: PV = Present value (price you would pay for the bond) C = Annual interest payment ($6,250) Show more…
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