Homework answers / question archive / 1) A zero coupon bond has a face value of $1,000 and matures in 6 years

1) A zero coupon bond has a face value of $1,000 and matures in 6 years

Finance

Share With

1) A zero coupon bond has a face value of $1,000 and matures in 6 years. Investors require? a(n) 7.1% annual return on these bonds. What should be the selling price of the? bond?

2) Ruth Hornsby is looking to invest in a three-year bond that makes semiannual coupon payments at a rate of 4.00 percent. If these bonds have a market price of $850.00, what yield to maturity and effective annual yield can she expect to earn? (Round answer to 2 decimal places, e.g. 15.25%.