Fifteen years remain on a 25-year, 8% coupon bond payable semiannually with a face value of $1,000. The return on comparable bonds is 10%. The formula for determining the market price of the bond today is:
A) PB = $40[FVFA10,25] + $1,000[FVF10,25]
B) PB = $40[PVFA4,30] + $1,000[PVF4,30]
C) PB = $80[PVFA4,15] + $1,000[PVF4,15]
D) PB = $40[PVFA5,30] + $1,000[PVF5,30]
Correct Answer:
Verified
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