Contemporary Engineering Economics 6th Edition by Chan Park

Exercise 3

You wish to sell a bond that has a face value of $1,000. The bond bears an interest rate of 7%, which is payable semiannually. Four years ago, the bond was purchased at $950. At least an 8% annual return on the investment is desired. What must be the minimum selling price of the bond now in order to make the desired return on the investment?