A coupon bond which pays interest annually, has a par value of $1,000, matures in 5 years and has a yield to maturity of 12%. If the coupon rate is 9%, the present value of the bond today should be __________.

A coupon bond which pays interest annually, has a par value of $1,000, matures in 5 years and has a yield to maturity of 12%. If the coupon rate is 9%, the present value of the bond today should be __________. 



A) $855.55
B) $891.86
C) $926.00
D) $1,000.




Answer: B


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