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3. S. Claus & Company is planning a zero coupon bond issue. The bond has a par value of $1,000, matures in 2 years, and

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3. S. Claus & Company is planning a zero coupon bond issue. The bond has a par value of $1,000, matures in 2 years, and will be sold at a price of $841.68. What is the annual cost of debt (YTM) to the company on this issue? a. 3.0% b. 5.0% c. 7.0% d. 9.0% e. 11.0%

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