Question

a. PV = -980

FV = 1000

PMT = 1000 * 0.08 = 80

N = 10

CPT I/Y

I/Y = 8.3021334

Yield to amturity = 8.30%

b. Now, witn N = 5

I/Y = 8.3021334

PMT = 80

FV = 1000

CPT PV

PV = -988.032142

The price of the bond now is \$988.03

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