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Morin Company’s annual bonds mature in 8 years, have a par value of $1,000, and currently...

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Finance

Morin Company’s annual bonds mature in 8 years, have a par valueof $1,000, and currently sells for $903.04. The market requires aninterest rate of 8.2% on these bonds. What is the bond’s couponrate? 7.50% 7.25% 6.50% 6.25% 6.10%

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3.8 Ratings (646 Votes)
650 Working Current selling price of a bond is the present value of cash flow from bond which is nothing but present value of par value and present value of annual coupon interest    See Answer
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Morin Company’s annual bonds mature in 8 years, have a par valueof $1,000, and currently sells for $903.04. The market requires aninterest rate of 8.2% on these bonds. What is the bond’s couponrate? 7.50% 7.25% 6.50% 6.25% 6.10%

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