Renfro Rentals has issued bonds that have a 10% coupon rate, payable semiannually. The bonds mature in 8 years, have a face value of $1,000, and a yield to maturity of 8.5%. What is the price of the bonds?
|Annual values||Semi-annual Inputs|
|Years to Maturity||8||16|
|Going rate, rd||8.5%||4.25%|
|Value of bond =||$1,084.59||$1,085.80|
Since it is payable semiannually
So, Price of the bonds = $ 1085.80