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Explain the direction of the bond price

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The ABB Company has $1,000 par value bonds outstanding at 9% interest. The bonds will mature in 20 years. What is the current price of the bonds if the yield to maturity is 6%? Suppose the credit rating of ZERO deteriorates next year. Explain the direction of the bond price, all other things assumed to be constant.

Reference no: EM132753107

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