Vulcan, Inc., has 8 percent coupon bonds on the market that have 8 years left to maturity. The bonds make annual payments and have a par value of $1,000. If the YTM on these bonds is 10 percent, what is the current bond price? (Do not round intermediate calculations and round your answer to 2 decimal places, e. G., 32.16.)

market price per bond = $893.30

Step-by-step explanation:

in order to determine the market price of the bonds we must calculate the present value of the face value and the present value of the coupon payments:

present value of face value = $1,000 / (1 + 10%)⁸ = $466.51

present value of coupon payments = $80 x 5.3349 (PV annuity factor, 10%, 8 periods) = $426.79

market price = $893.30

the entire expression should be subtracted from 30. to subtract the quantity, distribute the negative sign, which changes the signs on the terms. so, the –2 changes to positive and gets added to 30 instead of subtracted from it.

hope this ! ^w^

ok

step-by-step explanation: