A company issues a 1000 perpetual bond the current rate is, Ask an Expert

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A company issues a $1,000 perpetual bond. The current rate is 6%. Next period, the ratewill change to either 4% or 10%, with equal probability. The bond is callable at the endof the first year only, for a price of $1,117.90. What is the coupon amount, if the bond sells at par?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M93060148

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