Illustrate what is the fair price

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Reference no: EM13131768

You own a 30 year AAA rated corporate bond that you bought exactly 13 years ago. The stated rate on the bond indenture is 7.5%. The yield to maturity on new issues of similar corporate bonds is 5.2%. Someone offers you $1,225 for your bond. Is this a fair price, to you the seller? What is the fair price?

Reference no: EM13131768

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