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What is the current value under these conditions

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Reference no: EM133031668

Question - Twin Oaks Health Center has a bond issue outstanding with a coupon rate of 7 percent and four years remaining until maturity. The par value of the bond is $1,000, and the bond pays interest annually.

a. Determine the current value of the bond if present market conditions justify a 14 percent required rate of return.

b. Now, suppose Twin Oaks's four-year bond had semiannual coupon payments. What would be its current value?

c. Assume that Twin Oaks's bond had a semiannual coupon but 20 years remaining to maturity. What is the current value under these conditions?

Reference no: EM133031668

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