Bonds Sold Between Interest Payment Dates

missl

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Nov 12, 2007
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okay I was looking at my text book. Just wondering can someone explain how did they get the answer n: as 4.5

A six year bond with a face value of $1,000 bears interest at 7% semi-annually and matures on October 31, 2010. What is the selling price of the bond on July 15, 2006, if the market rate of interest is: 7% compounded semi-annually ?

-1,000 FV
-35 PMT
3.5 i
9 n ? 4.5?*2
COMP
PV
1,000
 

stapel

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What formula is being used? How is "n" defined? Is "9 n ? 4.5?*2" really a word-for-word copy of the provided solution? :shock:

Please reply with clarification. Thank you! :D

Eliz.
 

missl

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Nov 12, 2007
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well they were using a finanical calculator ... Opps I meant to say how did they get 9 as for their n i know how they got teh 2 but the rest not sure?
 

stapel

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missl said:
well they were using a finanical calculator ... Opps I meant to say how did they get 9 as for their n i know how they got teh 2 but the rest not sure?
Who is "they"? What did "they" do? In what context?

We aren't sitting in the room with you, so you'll need to communicate clearly. Using standard English spelling, punctuation, capitalization, and grammar to express complete thoughts would be very helpful. Thank you for your consideration.

Meanwhile, if you're wanting to know why a classmate punched particular calculator buttons in a particular order, wouldn't it be simplest to ask him...?

Eliz.
 
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