Consider a bond that has 20 years remaining until maturity, Ask an Expert

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Consider a bond that has 20 years remaining until maturity. Par value is $1000. Annual coupon rate is 14%, with annual payments period. Assume that the prevailing annualized yield on other bonds with similar characteristics is 14%. What is the bond’s fair value? Why the value of the bond equals to the par value?

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Financial Management, Finance

Category:- Financial Management
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