Your friend barbara has a bond that she would like to sell to you. the bond matures in 10 years, has a face value of $1,000 and a coupon interest rate of 6% (paid annually). if you know that the yield to maturity on similar bonds is 8%, what is the maximum price you would be willing to pay for the bond?

Given, the current market rate of 8% for  a similar bond, a bond with a face value of $1000.00 and paying a coupon rate of 6% annually. The maximum price I should be willing to pay is ($865 selling at a discount)

Variables:
C=coupon payment $60
n=number of years 10
i= market rate or required yield = 8%
k= number of coupon payments in 1 yr = 1
P=value at maturity or par value= 1000

The business cycle is the periodic but irregular up-and-down movement in economic activity, measured by fluctuations in real gross domestic product (gdp) and other macroeconomic variables. a business cycle is typically characterized by four phases—recession, recovery, growth, and decline—that repeat themselves over time. economists note, however, that complete business cycles vary in length. the duration of business cycles can be anywhere from about two to twelve years, with most cycles averaging six years in length. some business analysts use the business cycle model and terminology to study and explain fluctuations in business inventory and other individual elements of corporate operations. but the term "business cycle" is still primarily associated with larger (industry-wide, regional, national, or even international) business trends.