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What is the yield to maturity at a current market price

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Reference no: EM132473320

Point : The Apilado Company's bonds have 4 years remaining to maturity. Interest is paid annually; the bonds have a $1000 par value; and the coupon interest rate is 9 percent.

Question (a) What is the yield to maturity at a current market price of (1) $829 or (2) $1104?

Question (b) Would you pay $829 for one of these bonds if you thought that the appropriate rate of interest was 12 percent - that is, if kd = 12%? Explain your answer

Reference no: EM132473320

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