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Dexter Mills issued a 25-year bonds two years ago at a coupon rate of 10.2 percent....

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Finance

Dexter Mills issued a 25-year bonds two years ago at a couponrate of 10.2 percent. The bonds make semiannual payments. Theyield-to-maturity on these bonds is 9.2 percent. What is thecurrent bond price?

I got $5316.51, but I am unsure of my answer so would likeconfirmation + see the work to get the answer. Thanks!

Answer & Explanation Solved by verified expert
3.7 Ratings (539 Votes)
Current Price of the Bond The Current Price of the Bond is the Present Value of the Coupon Payments plus the Present Value of the face Value Face Value of the bond 1000 Semiannual    See Answer
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Transcribed Image Text

Dexter Mills issued a 25-year bonds two years ago at a couponrate of 10.2 percent. The bonds make semiannual payments. Theyield-to-maturity on these bonds is 9.2 percent. What is thecurrent bond price?I got $5316.51, but I am unsure of my answer so would likeconfirmation + see the work to get the answer. Thanks!

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