Peter just invested in a seasoned $1,000 par value with a 6% coupon rate.  The bond was originally issued for 25 years and currently has 10 years until it matures.  If the market interest is 8% and the bond pays interest semi-annually, then what is he likely to have paid for the bond?

A) ​$1,346
B) ​$1,000
C) ​$864
D) ​$827

Coupon Rate

The coupon rate is the annual interest payment made to bondholders, expressed as a percentage of the bond's face value.

Par Value

The nominal or face value of a bond, share of stock, or coupon as stated by the issuer; it is often a minimal amount like $0.01 or $1.00.

Matures

The point in time when a financial obligation, such as a bond or loan, reaches its due date and the principal amount must be repaid to investors or creditors.