Question #122951

a coupon bond is purchased for $900 with the maturity period of 6 years. the coupon payment of $50 is to be paid at the end of each half year. if the desired rate of return (yield rate) is J2=12% p.a. , then the face value of the bond is;

Expert's answer

"900=50*\\frac{1\/(1+0.12\/2)^{12}-1}{1\/1.06-1}+\\frac{x}{1.06^{12}}"

x-the face value of the bond

"x=916.87"

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