The internal rate of return for the cash flows

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1. A firm has an issue of $1,000 par value bonds with a 9 percent coupon. The issue pays interest annually and has 10 years remaining to its maturity date. If bonds of the same risk are currently earning 8 percent, what is the price of the bond?

1) $1,135.26

2) $915.29

3) $1,067.10

4) $951.53

2. Compute the internal rate of return for the cash flows of the following two projects (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.): Year Project A Project B 0 –$ 7,300 –$ 4,900 1 2,800 1,600 2 3,600 3,300 3 2,400 2,000 Internal rate of return Project A % Project B %

Reference no: EM131871281

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