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Find what would be the present value of the bond

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Reference no: EM132749770

Given below are information for an existing bond that provides annual coupon payments:

  • Par value of P1,000;
  • The coupon rate of 11%;
  • Maturity of four (4) years; and
  • The required rate of return by investors is 11%.

Problem a. What is the present value of the bond?

Problem b. If the required rate of return by investors were 14 % instead of 11%, what would be the present value of the bond?

Problem c. If the required rate of return by investors were 9%, what would be the present value of the bond?

Reference no: EM132749770

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