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-   -   How to compute bonds with semi-annual payment of interest? (https://www.askmehelpdesk.com/showthread.php?t=541106)

  • Jan 6, 2011, 01:05 AM
    angielynabano
    how to compute bonds with semi-annual payment of interest?
    par value = 1000
    coupon rate = 10%
    maturity = 25 years
    interest rate - 10%

    *required
    1.how much is the expected annual interest?
    2. how much is the interest every 6 months?
    3. how much is the expected par value at the end of 25years?
  • Jan 6, 2011, 02:06 AM
    manik chand dey
    par value = 1000
    coupon rate = 10%
    maturity = 25 years
    interest rate - 10%

    *required
    1.how much is the expected annual interest?
    2. how much is the interest every 6 months?
    3. how much is the expected par value at the end of 25years?

    1.expected annual interest is the coupon multiplied by the par value. i.e,10% on 1000, which is 100.
    2. you will get interest of 50 each for 50 times, if interest is paid every 6 months.
    3. expected par value you will get 1000.

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