A corporate bond is sold-the nominal rate of interest

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A corporate bond is sold for $1,000 (par value) with a 6% coupon. Shortly thereafter, interest rates in the economy (the nominal rate of interest) increases to 8% due to inflation worries. Give this scenario (all other things being equal), which of the following bond valuations for this bond in the secondary market would most likely happen: $1,000, $1,080, $1,196, or nothing given the choices

Reference no: EM131016077

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