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b ) A Tshs 1 0 0 0 perpetual bond is currently selling at Tshs 9 9 5 . The coupon rate of interest is

)

A Tshs

1000

perpetual bond is currently selling at Tshs

995 .

The coupon rate of interest is

13.5

percent and the appropriate discount rate is

15

percent.

Required:

Calculate the value of the bond. Should it be bought? What is its yield at maturity

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