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What should the price of each bond be

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Question - Mercy hospital has outstanding bonds with a remaining time to maturity of ten years. You are considering purchasing some of those bonds in the secondary market. The bonds have a coupon rate of interest of 7% and pay interest semiannually. Rates in the marketplace have dropped considerably since the bonds were originally issued so the current market rates on bonds of similar risk and maturity is now only 4.5%. What should the price of each bond be given the current market rates?

Reference no: EM132914408

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