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Author Question: Franklin Framing Inc. has twenty years remaining on 1,000 par value semiannual coupon bonds paying ... (Read 73 times)

Marty

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Franklin Framing Inc. has twenty years remaining on 1,000 par value semiannual coupon bonds paying semiannual coupons of 40. If the yield to maturity on these bonds is 6 per year, what is the current price?
 
  What will be an ideal response?

Question 2

Zero-coupon bonds are priced at deep discounts.
 
  Indicate whether the statement is true or false.



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wuly

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Answer to Question 1

Answer:
Bond Price = PMT  +
= 40  + = 1,231.15.
MODE = END, P/Y = 2, C/Y = 2
INPUT 40 6 ? -40 -1,000
KEY N I/Y PV PMT FV
CPT 1,231.15

Answer to Question 2

Answer: TRUE





 

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