1,000
ANSWER -1,135.78
If interest is paid annually:
Value (Vb) =
The value of the bond is $1,134.65:
8
4
60
1,000
ANSWER -1,134.65
7-7.
a. Series A:
Value (Vb) =
Value (Vb) =
Value (Vb) =
12
= 4 7 10
55
1,000
ANSWER -1,140.78 -880.86 -693.38
Series B
Value (Vb) = +
Value (Vb) = +
Value (Vb) = +
1
= 4 7 10
55
1,000
ANSWER -1,014.42 -985.98 -959.09
b. Longer-term bondholders are locked into a particular…
Words 1550 - Pages 7