In calculating the current price of a bond paying semiannual coupons, one needs to
A) use double the number of years for the number of payments made.
B) use the semiannual coupon.
C) use the semiannual rate as the discount rate.
D) All of the above need to be done.

Question

Quizplus · Accepted Answer

All of the above need to be done when calculating the current price of a bond paying semiannual coupons. Using double the number of years for the number of payments made, using the semiannual coupon, and using the semiannual rate as the discount rate are all essential steps in determining the bond's present value.

In Calculating the Current Price of a Bond Paying Semiannual