A bond with face value ₹1,000 pays a 10% coupon and is repaid, with that coupon, in 1 year. Buyers require 8% a year. To the nearest paisa, what is it worth? (Take $\frac{1}{1.08} = 0.9259$ .)

₹925.90Correct answerYour answer₹1,000Correct answerYour answer₹1,018.49Correct answerYour answer₹1,100Correct answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer C

Correct answer: C

Worth noting

₹925.90 discounts the face value but leaves out the coupon.

Ten questions from Perpetuity, Sinking Funds & Bonds, at your own pace.

Ten questions from Perpetuity, Sinking Funds & Bonds, at your own pace.

A bond with face value ₹1,000 pays a 10% coupon and is repaid, with that coupon, in 1 year. Buyers require 8% a year. To the nearest paisa, what is it worth? (Take 11.08=0.9259\frac{1}{1.08} = 0.92591.081​=0.9259.)