Bond and coupon rate help

[NotgettingFinance]

Hi. Can someone help an old student trying to go back to college with this fiance problem?

Assume that a bond will make payments every six months as shown on the following timeline (using six-month periods):
0 1 2 3 20
|____________|_______________|____________|______ . . . ______|
$20 $20 $20 $20 + $1000
a. What is the maturity of the bond (in years)?

*This is what I came up with, not sure I'm correctThe maturity of the bond in years would be the value of the six month period at 20 payments for 10 years (6 months x 20 payments = 120 months/12 = 10 years).

b. What is the coupon rate (in percent)?

*I started trying to work it, but not understanding: CPN = (Coupon Rate x Face Value)/(Number of Coupon Payment per year) x 1000/120 = %

c. What is the face value?

*I put some figures in a calculator, not sure: The face value is $1102.50

 

[tkhunny]

Maturity: Yes - 10 Years

Coupon Rate: (20*2)/1000 = 0.04 = 4%

Face Value: $1000 Are we looking for Maturity Value or Purchase Price?

 

[JeffM]

To expand a bit on tkhunny's explanation.

On a regular bond, let
F = face value
A = annual coupon rate
N = number of payments per year (on bonds in the US this is usually 2)
D = due each payment period except last
L = last payment due

D = F * A / N
L = F + I

 

[Denis]

OK; you're given this:

0            1               2            3                  20
|____________|_______________|____________|______ . . . ______|
?           $20             $20          $20              $20 + $1000

So you have an "instrument" that'll pay you 20 bucks every 6 months for 10 years,
plus 1000 bucks at end of the 10 years...now, forget that it's a bond...
Now, what is your REAL question?