What would have been the fair price for this bond

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Question - In December 2018, the U.S. Treasury issued 30-year bonds with a coupon rate of 3.1%, paid semiannually. The principal will be repaid in December 2048, and the bond's face value is $1000, paying coupons every six months until maturity. The market interest rate was 2.5% in December 2018 and you intended to hold the bond until maturity, what would have been the fair price for this bond by the time of its issuance?

A. $996

B. $1,126

C. $1,316

D. $1,526

E. Other

Reference no: EM132776240

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