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A zero-coupon bond is a bond that is sold now at a discount and will pay its face value at the time when it matures;

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A zero-coupon bond is a bond that is sold now at a discount and will pay its face value at the time when it matures; no interest payments are made. A zero-coupon bond can be redeemed in 20 years for $10,000. How much should you be willing to pay for it now if you want a return of: (a) 5% compounded daily? (b) 5% compounded continuously? (a) For a return of 5% compounded daily, you should pay $

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