Question

$4,85 Incorrect Question 6 0/10 pts A corporation issues 25-year $1,000 zero-coupon bonds. Calculate the price you must pay for one of these bonds based on a prevailing 12.5% annual rate. $242.42 $320.00 O $875.00 $52.62 Incorrect Question 7 0/10 pts

Answer 1

$52.62

Explanation:

The present value of an investment with a future value of $1000 at an interest rate of 12.5% compounded annually for 25 years is ...

$1000 × (1 + 0.125)^(-25) = $52.62