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A Florida state savings bond pays $4,000 when it matures 7 years from now, but it makes no other payments. If the state bonds are

A Florida state savings bond pays

$4,000

when it matures

7

years from now, but it makes no other payments. If the state bonds are to be competitive with U.S. savings bonds, which pay

12%

interest compounded annually, at what price will the state's bonds sell? At what price would the bond sell if U.S. savings bonds were paying

13%

interest compounded annually? Compare your answers.

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