Calculate the effective required rate of return

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Question - A debenture has a face value of R1 000 and an annual coupon interest rate of 7%. Interest is paid semi-annually, on 30 June and 31 December. Of the original 20 years to redemption, only 10 years of the life of the debenture remained on 31 December 2012. The market price of the debenture on that date was R872. Calculate the effective required rate of return of the debenture on 31 December 2012.

Reference no: EM133188655

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