Microhard has issued a bond with the following characteristics:
par: $1,000
time to maturity: 8 years
coupon rate: 11 percent
semiannual payments

calculate the price of this bond if the ytm is (do not round intermediate calculations and round your answers to 2 decimal places, e. g., 32.16.):

At Yield to maturity = 11%

Price = $1,000

Explanation:

As for the provided information we have:

Par value = $1,000

Interest each year = $1,000 11% = $110

Effective interest rate semiannually = 11%/2 = 5.5% = 0.055

Since it is paid semiannually, interest for each single payment = $110 0.5 = $55 for each payment.

Time = 8 years, again for this since payments are semi annual, effective duration = 16

Price of the bond =

Here, C = Coupon payment = $55

i = 0.055

n = Time period = 16

M = Maturity value = Par value = $1,000

Therefore, if yield to maturity = 11% then,

P =

= $1,000

15 1/2 years old in california

answer; is usually (less than) the socially optimal level of consumption;