Evaluating the value of a bond


Question: Calculate the value of a $1,000 bond which has 10 years until maturity and pays quarterly interest at an annual coupon rate of 12%. The required return on similar-risk bonds is 20%.

A. $845.66

B. $2,201.08

C. $835.45

D. $656.77

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Finance Basics: Evaluating the value of a bond
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