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Hillier Hillier
wrote...
Posts: 550
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6 years ago
A $5000 bond that pays 6% semi-annually is redeemable at par in 14 years. Calculate the purchase price if it is sold to yield 8% compounded semi-annually.
Textbook 
Contemporary Business Mathematics with Canadian Applications

Contemporary Business Mathematics with Canadian Applications


Edition: 11th
Authors:
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wrote...
6 years ago
PMT =   = $150
PP = 5000(1 + 0.04)-28 + 150 
PP = 1667.39 + 2499.46
PP = $4166.85

Programmed solution:


The purchase price is 1667.39 + 2499.46 = $4166.85
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