Assuming annual payments-what is the value of the bond

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(Round answer to 2 decimal places, e.g. 15.25.) ***Bond Value is 1000

A. AAA Corp is issuing a 10-year bond with a coupon rate of 6.76 percent. The interest rate for similar bonds is currently 6.37 percent. Assuming annual payments, what is the value of the bond?

B. AAA just received a cash gift from his grandfather. He plans to invest in a five-year bond issued by BBB CORP. that pays an annual coupon of 4.79 percent. If the current market rate is 9.00 percent, what is the maximum amount AAA should be willing to pay for this bond?

Reference no: EM13873695

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