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A $10,000 Bond Can Be Redeemed for $10,450 in 10

Question 2

Multiple Choice

A $10,000 bond can be redeemed for $10,450 in 10 years.It pays 20 semi-annual coupons at j2 = 7%.The book value adjustment for the 4th coupon is $22.40 and the book value adjustment for the 5th coupon is $23.24.What is the book value of the bond after 6 years (12 coupons) ?


A) $10,341.74
B) $10,297.80
C) $10,165.13
D) $10,051.24

Correct Answer:

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