Bond valuation—Semiannual interest
Calculate the value of each of the bonds shown in the following table, all of which pay interest semiannually.
Bond |
Par Value |
Coupon interest rate |
Years to maturity |
Required stated annual return |
||||
A |
$1,000 |
9 |
% |
9 |
8 |
% |
||
B |
500 |
13 |
20 |
14 |
||||
C |
500 |
15 |
6 |
15 |
Please refer to below spreadsheet for calculation and answer. Cell reference also provided.
Cell reference -
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