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A corporation's bonds will mature in 8 years. They were issued 12 years ago in a higher inflation environment. The bonds pay $30 in interest
- A corporation's bonds will mature in 8 years. They were issued 12 years ago in a higher inflation environment. The bonds pay $30 in interest semi-annually. If Grove were to issue similar bonds at par value today, they would pay $40 in interest per year. Face value = $1,000.
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- Whats the price of the bond today?
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- Is this bond selling at a Premium? Discount? Or par value?
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- What will the price of the bond be at maturity (i.e. right before you receive the face value)?
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International Business Competing In The Global Marketplace
Authors: Charles Hill
14th Edition
1260387542, 9781260387544
