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Suppose that because of the popularity of Jack Brown's, Aaron decides to open a third restaurant and issues another round of $10,000 one-year bonds. If the interest rate on the bond falls to 12%, the price of these new bonds is $???
12% = $10000 - X Divided by X Times 100

Sagot :

The price of the new bonds given the face value and interest rate is $8,928.57.

What is the price of the bonds?

Bonds are debt instruments issued by a firm with the purpose of raising capital to carry out projects. The price of the bonds can be determined by discounting the face value of the bonds by the interest rate.

The price of the bonds = face value of the bonds / ( 1 + interest rate)

$10,000 / (1.12) = $8,928.57

To learn more about bonds, please check; https://brainly.com/question/8917277

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