A P 1,000 bond with a 6% annual coupon pays interest semiannually and will be redeemed at 110% of its face value on June 21, 204. If the bond is purchased on June 21, 2001 to yield an effective interest rate of 4%, what is the price of the bond?

Engineering Economy MCQs for PPSC, FPSC, NTS, and Pakistan government job tests. Select an option below, then read the explanation.

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Subject
Engineering Economycivil-engineering-mcqs › engineering-economy
Published
21 Jan 2019
Last updated
28 May 2026

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Explanation

The bond's price is determined by discounting the semiannual coupon payments and the redemption value at the yield rate of 4%. Using the given parameters, the calculated price of the bond is P 1,144.81.

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