Planning on issuing bonds that pay no interest

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Reference no: EM131816332

1. (Present value?) The Kumar Corporation is planning on issuing bonds that pay no interest but can be converted into $4,000 at? maturity, 5 years from their purchase. To price these bonds competitively with other bonds of equal? risk, it is determined that they should yield 15 percent, compounded annually. At what price should the Kumar Corporation sell these? bonds? Kumar Corporation should sell these bonds at $. (Round to the nearest? cent.)

?2. (Spreadsheet problem?) If you invest ?$900 in a bank in which it will earn 8 percent compounded? annually, how much will your investment be worth at the end of 7 years? Use a spreadsheet to do your calculations. How much will your investment be worth at the end of 7 years? $(Round to the nearest? cent.)

Reference no: EM131816332

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