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10 July, 08:42

What is the value of a 20-year, zero-coupon bond with a face value of $1,000 when the market required rate of return is 9.6 percent, compounded semiannually?

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  1. 10 July, 09:09
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    The answer is $153.30

    Explanation:

    Value = M / (1 + i) ^n = 1000/[ (1 + (0.096/2)) ^40] = $153.30

    Value is $153.30
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