CGJ Bicycles, Incorporated, is currently selling bonds with an annual coupon of 13 percent. The yield to maturity for these bonds is 6.68 percent and they will mature in 29 years. What should be the current market price of each bond if they each have a face value of $1,000?

CGJ Bicycles, Incorporated, is currently selling bonds with an annual coupon of 13 percent. The yield to maturity for these bonds is 6.68 percent and they will mature in 29 years. What should be the current market price of each bond if they each have a face value of $1,000?

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter22: Corporations: Bonds

Section: Chapter Questions

Problem 1CE

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Question

CGJ Bicycles, Incorporated, is currently selling bonds with an annual coupon of 13 percent. The yield
to maturity for these bonds is 6.68 percent and they will mature in 29 years. What should be the
current market price of each bond if they each have a face value of $1,000?
O$1,494.42
$1,801.05
O $1,805.38
$1.647.73
O $527.89

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