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Calculate the price that a bond investor

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Reference no: EM132417229

Problem: You purchased one XYZ bond six years ago in the marketplace for $1,250.

The bond's coupon rate is 7%.

The bond matures 18 years from now.

New bonds, similar in risk and quality to the XYZ bond that you currently own, are being

issued in the market with a coupon rate of 8%.

Calculate the price that a bond investor would be willing to pay to purchase your bond today.

Assume that interest payments from the bond are received twice per year.

Reference no: EM132417229

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