Answer :
The price of a coupon bond that has annual coupon payments of $75, a face value of $1000, an interest rate of 5%, and a maturity of two years is $1046.49.
In finance and economics, interest is the price from a borrower or deposit-taking economic group to a lender or depositor of a quantity above compensation of the predominant sum, at a particular price. it is distinct from a fee that the borrower may pay the lender or some third birthday celebration.
Interest is defined as the quantity of money paid for the usage of a person else's cash. An example of the hobby is the $20 that changed into earned this yr on your savings account. An instance of interest is the $2000 you paid in interest this 12 months on your own home mortgage.
The payment of the hobby makes up for this inconvenience. 2nd, a borrower may additionally default at the mortgage.
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