What price can he pay for the bond

Assignment Help Econometrics

Reference no: EM13180449

A person buys a $1,000 face value bond 2 years after its issue. He intends to keep it until its maturity date, which is 18 years from now. This bond pays 6% annually. What price can he pay now for the bond so that his investment earns 8%? The investor gets the face value back at the maturity.

Reference no: EM13180449

Questions Cloud

Find the equation of the regression line for the given data : Find the equation of the regression line for the given data. Predict the value of Y when X=-2? Predict the value of Y when X = 4?

What is the number of fish : what is the number of fish? six months what is the total number of fish? One year after,what are the total number of fish. Round to the nearest whole number.

Difference between prime numbers and composite numbers : What is the difference between prime numbers and composite numbers? How are prime numbers and composite numbers related? Prime numbers are often used in cryptography.

Draw a scatter diagram of crsl customers : Draw a scatter diagram of CRSL customers and staff costs and mark the relevant range and high-low method to estimate the behaviour of CRSL staff cost based on customer numbers within the relevant range. Use an equation to express the results of thi..

What price can he pay for the bond : A person buys a $1,000 face value bond 2 years after its issue. He intends to keep it until its maturity date, which is 18 years from now. This bond pays 6% annually. What price can he pay now for the bond so that his investment earns 8%?

Explain the comparative advantage enjoyed by each country : Develop a response that includes examples and evidence to support your ideas, and which clearly communicates the required message to your audience. Organize your response in a clear and logical manner as appropriate for the genre of writing. Use w..

How many arrangements of the digits : Use the recurrence equation above and strong induction to prove that F(n) =1, where F(n) is the Fibonacci sequence.

User Account

All Pages