Atlas Movers is issuing $1,000 face value zero-coupon bonds at a quoted price of 38.70. What is the amount you would pay to purchase one of these bonds?

Question

Quizplus · Accepted Answer

The quoted price of 38.70 for a zero-coupon bond means that the bond is sold for 38.70% of its face value. Therefore, to find the purchase price, you multiply the face value ($1,000) by 38.70%, resulting in $387.00.

Atlas Movers Is Issuing $1,000 Face Value Zero-Coupon Bonds at a Quoted