Problem 13-08 Bond A has the following terms: Coupon rate of interest (paid annually):...
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Finance
Problem 13-08
Bond A has the following terms:
- Coupon rate of interest (paid annually): 12 percent
- Principal: $1,000
- Term to maturity: Ten years
Bond B has the following terms:
- Coupon rate of interest (paid annually): 6 percent
- Principal: $1,000
- Term to maturity: Ten years
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What should be the price of each bond if interest rate is 12 percent? Use Appendix B and Appendix D to answer the question. Round your answers to the nearest dollar. Price of bond A: $ Price of bond B: $
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What will be the price of each bond if, after four years have elapsed, interest rate is 12 percent? Use Appendix B and Appendix D to answer the question. Round your answers to the nearest dollar. Price of bond A: $ Price of bond B: $
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What will be the price of each bond if, after ten years have elapsed, interest rate is 11 percent? Use Appendix B and Appendix D to answer the question. Round your answers to the nearest dollar. Price of bond A: $ Price of bond B: $
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