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accounting

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a 10 year bond pays 8% on a face value of $1000. If similar bonds are yeilding 10%, what is the market value of the bond. use annual analysis

  • accounting -

    The formula is:
    PV of the principle, $1,000
    Plus the PV of the interest

    Are you using Present Value Tables?
    PV of the principle comes from the PV of $1.

    PV of the interest is one years' interest and the factor from he PV of annuity table.

    Use the 10% column from the table for 10 periods.

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