The annual required return on the bond

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Jallouk Corporation has a bond outstanding with a face value of $10,000. The bond matures in 20 years. The bond makes no coupon payments for the first six years, then pays $1,200 every six months over the subsequent eight years. Finally, the bond pays $1,500 every six months over the last six years. The face value (original principal on the loan) is also repaid at maturity. The annual required return on the bond is 6 percent with semi-annual compounding.

What is the price of this bond?

Note: there are two separate annuities (coupons). Don't forget to adjust their present values to account for the fact they don't begin at the end of the first period.  (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

Reference no: EM131566409

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