Answer:
Zero-cupon bond= $835.45
Explanation:
Giving the following information:
Face value= $1,000
YTM= 11.3%
Years to maturity= 16 years
To calculate the price of the bond, we need to use the following formula:
Zero-cupon bond= [face value/(1+i)^n]
Zero-cupon bond= 1,000 / (1.113^16)
Zero-cupon bond= $835.45
