Find the price of a 30-year zero coupon bond with a €1,000 par value that has a yield to maturity of i_€ = 5 percent.

Question

Quizplus · Accepted Answer

The formula to find the price of a zero-coupon bond is: 
Price = Face value / (1 + r)^n 
Where r is the yield to maturity and n is the number of years until maturity. 
In this case, n = 30 and r = 0.05. 
Price = 1000 / (1 + 0.05)^30 = €231.38 
Therefore, the correct answer is A.

Find the Price of a 30-Year Zero Coupon Bond with a €1,000