If the going interest rate on these bonds is 35 compounded


Suppose a State of Missouri bond will pay $10,000 when it matures 5 years from now. This is a zero-coupon bond, which means that there are no interest payments between now and when the bond matures. That is, there is only a single cash flow 6 years from now. If the going interest rate on these bonds is 3.5% (compounded annually), how much is the bond worth today?

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Finance Basics: If the going interest rate on these bonds is 35 compounded
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