Suppose that a 15-year 1000 face value bond pays interest

Reference no: EM13459959

Assume that a 15-year, $1,000 face value bond pays interest of$37.50 every 3 months. If you require a nominal annual rate of return of 12 percent, with quarterly compounding, how much should you be willing to pay for this bond? (Hint: The PVIFA and PVIF for 3 percent, 60 periods are 27.6748 and 0.1697, respectively.)

a. $821.92

b. $1,207.57

c. $986.43

d. $1,120.71

e. $1,358.24

Reference no: EM13459959

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