An investor owns a 3000 par-value 12 bond with semiannual, Ask an Expert

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An investor owns a $3,000 par-value 12% bond with semiannual coupons. The bond will matrue at par at the end of fourteen years. The investor decides that a ten-year bond would be preferable. Current yield rates are 6% convertible semiannually. The investor uses the proceeds from the sale of the 12% bond to purchase and 8% bond with semiannual coupons, maturing at par at the end of ten years. Find the face value of the 8% bond.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92800079

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