Giles co wants to issue new20-year bonds for expansion, Ask an Expert

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Giles Co wants to issue new20-year bonds for expansion projects. The company currently has 7%coupon bonds on the market that sell for $1,062, makesemi-annual payments, and mature in 20 years. What couponrate should the company set on its new bonds if it wants to sellthem at par? Show work.

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