Fill This Form To Receive Instant Help

Help in Homework
trustpilot ratings
google ratings


Homework answers / question archive / What is the price today of a zero coupon bond with a face value of $4,000 if the relevant market yield is 9% pa and with 2 years to maturity? Calculate the price to the nearest dollar

What is the price today of a zero coupon bond with a face value of $4,000 if the relevant market yield is 9% pa and with 2 years to maturity? Calculate the price to the nearest dollar

Accounting

What is the price today of a zero coupon bond with a face value of $4,000 if the relevant market yield is 9% pa and with 2 years to maturity? Calculate the price to the nearest dollar

pur-new-sol

Purchase A New Answer

Custom new solution created by our subject matter experts

GET A QUOTE

Answer Preview

We can calculate the price of the bond by using the following formula in excel:-

=-pv(rate,nper,pmt,fv)

Here,

PV = Price of the bond

Rate = 9%

Nper = 2 periods

Pmt = 0

FV = $4,000

Substituting the values in formula:

= -pv(9%,2,0,4000)

= $3,366.72 Or $3,367