You are offered a zero coupon bond worth 10000 in face

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You are offered a zero coupon bond worth $10,000 in face value 20 years from now. Assume that you believe inflation over this time period would average 1.75% per year and that you believe the stock market might yield a 10% per year return, but would also have a 6% risk premium over this bond. What price would you be willing to pay for this bond today?

Reference no: EM13634776

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