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An insurance group is in the process of evaluating a zero coupon bond purchase from a healthcare organization the needs capital financing.

On January 1, 2001 the bonds wer epurchaed at a discounted rate of $6757.04 with a 5.5% original issue yield and semiannual combounding.

On which date will they become due if these bonds have a face value of $20,000 and assuming the interest rates remain stable?

1) January 1, 2020,

2) December 31, 2020,

3) January 1, 20210,

4) January 1, 2022.

(Please explain in detail how you come to the answer)

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92765502

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