Exhibit 18.2
Use the Information Below for the Following Problem(S)
Talmart Corporation bonds have a $1,000 face value and will mature in 4 years. The bonds have a 7% coupon rate. Interest is paid annually and the required rate of return is 6 percent for these bonds.
-Refer to Exhibit 18.2.What is the price of the Talmart corporate bonds?
A) $965.63
B) $966.13
C) $1,034.65
D) $1,135.10
E) $1,051.97

Question

Quizplus · Accepted Answer

$$P _ { 0 } = \$ 70 \left( \frac { 1 - \frac { 1 } { 1.06 ^ { 4 } } } { .06 } \right) + \frac { \$ 1,000 } { 1.06 ^ { 4 } } = \$ 1,034.65$$

Exhibit 18.2 Use the Information Below for the Following Problem(S)