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problem: Consider a bond with face value of $1,000. The coupon payment is made semi yearly and the yield to maturity on the bond is 12 percent [effective annual yield]. How much would you pay for the bond if:

[A]     The coupon rate is 10 percent and the time to maturity is fifteen years?

[B]      The coupon rate is 8 percent and the time to maturity is twenty years?

Basic Finance, Finance

  • Category:- Basic Finance
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