How would i calculate the initial investment

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Reference no: EM133344259

Question: How would I calculate the initial investment for the below question?

Your company has the option to buy $30 million in bonds. These bonds are priced at a discount to par value, and the discount is quoted as $95. This means that each bonds maturity value is $100 but can be purchased today for $95 each. Using the same percentage, how much would your company need to pay today for these bonds? 10 year bond, 8% coupon, priced as a discount: $95, and discount rate is 9%. What would be the initial investment amount?

Reference no: EM133344259

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