What is the current market price of the bonds

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Reference no: EM131822339

1. General Mills has a $1,000 par value, 15-year to maturity bond outstanding with an annual coupon rate of 9.39 percent per year, paid semiannually. Market interest rates on similar bonds are 10.32 percent. Calculate the bond’s price today.

2. Fresh Water, Inc. sold an issue of 27-year $1,000 par value bonds to the public. The bonds have a 7.86 percent coupon rate and pay interest annually. The current market rate of interest on the Fresh Water, Inc. bonds is 10.72 percent. What is the current market price of the bonds?

Reference no: EM131822339

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