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Question

Find the price a purchaser should be willing to pay for the given bond. Assume that the coupon interest is paid twice a year.

$25,000 bond with coupon rate 7% that matures in 10 years; current interest rate is 6%.

Solution

VerifiedAnswered 2 years ago

Answered 2 years ago

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1 of 6**Given:** $\$25,000$ bond with coupon rate $7\%$ that matures in $10$ years;
current interest rate is $6\%$.
**To Find:** the price a purchaser should be willing to pay for the given
bond. Assume that the coupon interest is paid twice a year

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