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A Company Issues a Ten-Year $1000 Bond at Par with a Coupon

Question 21

Multiple Choice

A company issues a ten-year $1000 bond at par with a coupon rate of 6% paid semi-annually.The YTM at the beginning of the third year of the bond (8 years left to maturity) is 7.8%.What is the new price of the bond?


A) $894.35
B) $569.65
C) $722.06
D) $1,000.00
E) $1,064.52

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