Calculate the present value of a $1,000 discount bond with five years to maturity if the yield to maturity is 6%.

The present value of the bond is $747.25

Explanation:

In order to find the present value of a bond we need to know its future value, its years to maturity, its yield to maturity and its payments. The question tells us that is a discount bond which means it has 0 payments and it tells us the other 3 variables. We will put these variables in a financial calculator in order to find the present value.

FV= 1000

N=5

PMT=0

I=6

Compute present value =747.25

income statement is prepared in order to show the profits and loss of a business. in order to prepare the income statement she should collect all the income and expenses of the product with the cost of production.

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