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A bond has a 10-year maturity, a 5% coupon paid semiannually, and $1000 par value. The required rate of return (yield to maturity)on the bond
| A bond has a 10-year maturity, a 5% coupon paid semiannually, and $1000 par value. | ||||
| The required rate of return (yield to maturity)on the bond is 11%. | ||||
| Compute the price of the bond today using a table of cash flows | ||||
| (discount the cash flow in each period back to the present using the time value of money formula) | ||||
| SHOW WORK HERE, HIGHLIGHT FINAL ANSWER IN YELLOW | ||||
| Period (NPER) | Cash flow | PV | ||
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Investment Science
Authors: David G. Luenberger
1st International Edition
0195391063, 9780195391060
