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3. (40%) A bond has a face value of $1,000, has 10 years until maturity, and an annual coupon rate of 7%. The market interest

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3. (40%) A bond has a face value of $1,000, has 10 years until maturity, and an annual coupon rate of 7%. The market interest rate (i) is 5% currently. b) What is the bond price now (Bo)? c) What is the bond price the next year (B1) if the yield remains constant? d) What is the difference between the next year (B1) and this year (Bo) bond price

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