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A company has bonds outstanding, with the following characteristics: Bon Face value $1,000 Years to maturity 16 Coupon rate 6% Yield to maturity 8% Frequency

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A company has bonds outstanding, with the following characteristics: Bon Face value $1,000 Years to maturity 16 Coupon rate 6% Yield to maturity 8% Frequency of coupons annual (a) How much should each bond sell for in today's market? $1,000 (b) TRUE OR FALSE? Bond's value decreases when yield to maturity increases. FALSE

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