Suppose you have a bond with 4 years to maturity what is


1. Suppose you have a bond with 4 years to maturity. The face value of the bond is $1,000 and its coupon rate is 6 percent (annual payments). When the required yield on this bond is 8 percent (compounded annually), what is the current price of the bond?

A $964.3 B $933.8 C $1,035.7 D $1,067.2

2. Alonzo plans to retire as soon as he has accumulated $250,000 through quarterly payments of $2,000. If Alonzo invests this money at 5.4% interest, compounded quarterly, how long (to the nearest year) until can he retire?

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Financial Management: Suppose you have a bond with 4 years to maturity what is
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