Question

Ryngaert Inc. recently issued noncallable bonds that mature in 15 years. They have a par value of $1,000 and an annual coupon of 5.7%. If the current market interest rate is 7.0%, at what price should the bonds sell?

Answer 1

Answer:

B

o

n

d

P

r

i

c

e

=

C

∗

1

−

1

(

1

+

r

)

n

r

+

F

(

1

+

r

)

n

Here,

C=Co...