What is the bonds nominal coupon interest rate

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1. One year ago Lerner and Luckmann Co. issued 15-year, noncallable, 5.5% annual coupon bonds at their par value of $1,000. Today, the market interest rate on these bonds is 5.5%. What is the current price of the bonds, given that they now have 14 years to maturity?

a. $1,000.00

b. $990.37

c. $993.58

d. $1,003.21

e. $996.79

2. Field Industries' outstanding bonds have a 25-year maturity and $1,000 par value. Their nominal yield to maturity is 9.25%, they pay interest semiannually, and they sell at a price of $1,075. What is the bond's nominal (annual) coupon interest rate?

a. 9.86%

b. 9.70%

c. 10.18%

d. 10.02%

e. 10.34%

Reference no: EM132014641

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