Assume you have owned a 20-year $1000 bond with a coupon rate of 6% for 17 years. If current interest rates on similar bonds are 9%, at what price could you sell the bond today?

Answer 1

(60/1.09) + (60/1.09^2) + (1060/1.09^3) = 55.05 + 50.50 + 818.51 = $924.06