Calculate the current value of the bond

Reference no: EM1367015

Due to a number of lawsuits related to toxic wastes, major chemical producre has recently experienced a market revaluation. The company has a bond issue outstanding with fifteen years to maturity and a coupon rate of 8 percent, with interest paid semiannually. The required nominal rate on this debt has risen to 16%. Calculate the current value of this bond.

a. $1,273

b. $1,000

c. $7,783

d. $ 550

e. $ 450

Reference no: EM1367015

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