Question

Source: Tommy Stubbington and Ben​ Edwards, open double quoteU.K. to Repay First World War ​Bonds,close double quote Wall Street Journal​, October​ 31, 2014. A few years ago the British government was considering​ retiring, or buying back from​ investors, some outstanding consols that had annual coupons of pound60. A consol​ is:

Answer 1

Follows are the solution to this question:

Step-by-step explanation:

Its console shall be coordinated effort mutual funds which do not grow at all, and in every year they create a corrected degree of interest, that's why Its bond paying a fixed rate of the coupon but not maturing.

`\text{Consolation price} =\frac{\text{Set amount of coupon}}{\text{Return Rate}}`

`= (35)/(2.5\%) \\\\ = (35* 100)/(2.5) \\\\ = (35* 1000)/(25) \\\\ = (7* 1000)/(5) \\\\ = 7* 200 \\\\= 1400`

It's the price that the government needs to offer shareholders.