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On April 1, Braintree Corporation issued 10%, ten-year, $300,000 bonds at 106. The effective interest rate for these bonds is a) 4.7%. b) 9.43%. c) 10%. d) 5%
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On April 1, Braintree Corporation issued 10%, ten-year, $300,000 bonds at 106. The effective interest rate for these bonds is

a) 4.7%.

b) 9.43%.

c) 10%.

d) 5%

User Mike Patrick
by
5.8k points

2 Answers

4 votes

Answer:

Step-by-step explanation:

Interest rate = YTM = 10 + [ 100-106]/10]/ (100+106)/2

User NKD
by
6.4k points
1 vote
i think the answer is B. 9.43%.
User Proximo
by
5.7k points
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