Homework Help: Pre-Calculus

Posted by Stacy on Friday, December 10, 2010 at 6:05am.

What is the present value of a $1000 bond which pays $50 a year for 10 years, starting one year from now? Assume interest rate is 6% per year, compounded annually

Pre-Calculus - Reiny, Friday, December 10, 2010 at 10:19am
PV = 50 [ 1 - 1.06^-10]/.06 + 1000(1.06)^-10
= 926.40

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