A semi-annual coupon bond is a bond that pays interest twice a year at a fixed rate.
To determine the amount of semi-annual coupon paid, you can use the following formula:
C = (r * FV) / n
Where:
C = coupon payment (semi-annual)
r = annual coupon rate (3% in this case)
FV = face value (100,000 in this case)
n = number of coupon payments per year (2 for semi-annual)
So, the semi-annual coupon payment for the bond is:
C = (0.03 * 100,000) / 2
C = 1500
The bond matures after 8 years, so the bond will pay 8*2 = 16 semi-annual coupons.
