Question

sonia bought a bond with a face value of $4000 and a coupon rate of 7.75%. The bond will mature in 20 years. how much interest will she receive semi-monthly

Answer 1

155 interest to be received semi-annually.

Explanation:

Got it right on the test.

Answer 2

Given:
Face value of the bond = 4,000
coupon rate = 7.75%
bond will mature in 20 years.

7.75% is annual rate.

4,000 * 7.75% = 310 interest to be received annually.
310 * 6/12 = 155 interest to be received semi annually.

310 * 210 years = 6,200 total interest earned in the 20 year term of the bond.