Kilgore Natural Gas has a $1,000 par value bond outstanding that pays 10 percent annual interest. The current yield to maturity on such bonds in the market is 11 percent. Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods.
Compute the price of the bonds for these maturity dates:
Bond Price?
a. 40 years:
b. 17 years:
c. 8 years: