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What is the value of a semi-annual pay 9% coupon bond 2 years from now that...

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Finance

  1. What is the value of a semi-annual pay 9% coupon bond 2 yearsfrom now that was bought in 2019 and matures in 15 years if ratesgo to 10% in 2 years.

  1. 1000
  2. 923
  3. 928
  4. 965

Answer & Explanation Solved by verified expert
4.3 Ratings (715 Votes)
Solution Answer is C 928 Working Notes Notes Value of bond is the cash flow during the remaining life of bond after two year life remain will be 13 YEARS and market rate will be 10 so the cash flows will be discount at this 10 to get    See Answer
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What is the value of a semi-annual pay 9% coupon bond 2 yearsfrom now that was bought in 2019 and matures in 15 years if ratesgo to 10% in 2 years.1000923928965

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