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A bond information: Par value = $1000 Coupon Rate = 15% Number of years to maturity = 2 years Annual coupon paying bond. If price

A bond information:

Par value = $1000

Coupon Rate = 15%

Number of years to maturity = 2 years

Annual coupon paying bond.

If price of bond is $1,068.50, then what is the yield-to-maturity of this bond (the price is rounded up to 2 decimal places)?

a) 8% b) 9% c) 10% d) 11%

Choose the answer and explain why you choose the answer choice.

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