Selling at a Discount - BMGT 220, University of Maryland--College Park

When a bond's coupon rate is less than the market rate, that bond will sell at a discount. We'll figure out how to price a bond in that situation.

This Video Mentioned Some Formulas

Bond Face Value

+ Unamortized Premium

– Unamortized Discount

Bond Carrying Value

Bond Face Value * PV$1(i,n)

+ Payment Amount * PVOA(i,n)

Bond Selling Price

When calculating the selling price, be sure to use the Market Rate for i.

The Rest Of The Videos

Topic 11 Practice Problems

1	Intro to Bonds	10:04
2	Discounts and Premiums	7:34
3	Selling at a Discount You are here.	7:15
4	Selling for a Premium	8:11
5	Amortization	21:42
6	Borrowing Cost	6:33
7	Interacting with Market Rates	5:30
8	Retiring Bonds	9:54

	Click Here to View All Topic 11 Problems at Once	View
1	Bond Theory Multiple Choice	Easy
2	Bond Issue Prices	Moderate
3	Coupon and Market Rates Multiple Choice	Moderate
4	Bond Amortization	Hard
5	Bond Retirement	Hard

This Video Mentioned Some Formulas