Can you do this on a calc using N, IY, etc.?

Question

Jane Walker has set a 7% yield as the goal for the bond portion of her portfolio. To achieve this goal, she has purchased a 7%, 15-year corporate bond at a discount price of 93.50. What amount of reinvestment income will she need to earn over this 15-year period to achieve a compound return of 7% on a semiannual basis?A)$459.B)$624.C)$574.Explanation935(1.035)30 = $2,624Bond coupons: 30 × 35 = $1,050Principal repayment: $1,0002,624 − 1,000 − 1050 = $574 required reinvestment income(Study Session 15, Module 46.1, LOS 46.a)

fp92 · Answer

The explanation seems to have incorrect notation and missing the power function. Also I'm not sure whether the bond price stated in the question as 93.50 or 935.0? Because the answer shows 935 but I've used 93.50 as what you copied down, but the principle is the same (but assuming a $100 par instead of $1,000 par like the explanation) Total future cash flows = 93.50 * (1.035)^ 30 = 262.435Bond coupons = 15 * $7 = 105Principal repayment = $100So reinvestment income = 262.435 - 105 - 100 = $57.435What part of the question/answer do you not understand? Will see if I can explain

pcunniff · Answer

Sorry @fp92 - I was not clear enough. I was seeing if you could calculate this problem by using the TVM functions in your calculator. The question did state 93.5 as a FYI