A bond that has sinking fund provision

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1. A bond that has a sinking fund provision

may repurchase a certain percent of bonds through a redemption process based on a numbering or lottery type system.

may repurchase a certain percent of bonds in the open market.

is usually considered safer than a bond issue that does not have a sinking fund provision.

All of the above are correct.

2. A coupon bond that pays interest annually has a par value of $1,000, matures in 8 years, and has a yield to maturity of 6%. If the coupon rate is 7%, then value of the bond today will be __________.

 

 

Reference no: EM131614070

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