Answer to Question #158102 in Finance for Abdul Mannan

Question #158102

1. Pakistan State Oil (PSO) issues a bond with a par value of PKR1,000, 15 years to maturity, and a coupon rate of 5 percent paid annually. If the yield to maturity is 4 percent, what is the current price of the bond?


1
Expert's answer
2021-01-27T15:02:30-0500

"P = 50\u00d7\\frac{1 - 1.04^{-15}} {0.04} + \\frac{1,000} {1.04^{15}} = PKR1,111.18."


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