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What is the current price of bond

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Reference no: EM133116991

a) A bond issued in the United States pays coupons four times per year (thus, pay coupons quarterly). It has a 20-year maturity, its annual coupon rate is 8 percent, and it is selling to yield 6 percent. What is the current price of the bond?

b) A U.S. dollar-denominated bond issued in Europe pays coupons once per year. This bond also has a 20-year maturity and a 8 percent coupon rate, but it is selling to yield 6.20 percent. What is the current price of this bond?

c) Do you think that either of these bonds is the better buy? Explain

Reference no: EM133116991

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