Hi guys, firstly sorry if I’m posting in the wrong section, I don’t really know where to post this… I have to take a maths test and I don’t know how to solve the following issues , this question for your guys I think it should be a piece of cake because it’s for a test much less difficult than CFA !
This question comes from a study guide and I’m trying to use a financial calculator to do but can’t seem to get it right! Hope you can help me , here’s question: Company A issues a three-year bonds with a coupon rate of 10%, a face value of HK$20,000 and dividends paid once a year. At the time of issue, market investors required a return of 8%. According to the above terms, what is the market price of the bond? Accord to the study guide the answer is : 21,030.83 but I don’t know how to get to this answer! My assumption is: N: 3 I/Y : So far I’ve tried 10% , 8%, 18% and 108% (and it all came out wrong) PMT: 2000 FV: 20000 I’m sure my assumption is wrong! Please help?? Thank you!!!