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Posted on Jun 26, 2024

B Corporation has $1000 par value bonds with 9 years left to maturity, a stated annual coupon rate of 6.5 percent (with annual interest payments).

B Corporation has $1000 par value bonds with 9 years left to maturity, a stated annual coupon rate of 6.5 percent (with annual interest payments).

What are these bonds worth today if the required market rate of return is 6 percent? _

What are these bonds worth today if the required market rate of return is 5 percent?

What are these bonds worth today if the required market rate of return is 3 percent?____

What is the relationship between the coupon rate, changes in the market rate and the value of these bonds?

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