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Company A has a bond outstanding with 10% coupon rate; 10 year to maturity, and face value of $1,000; interest is payable annually. A similar
Company A has a bond outstanding with 10% coupon rate; 10 year to maturity, and face value of $1,000; interest is payable annually. A similar bond yield to maturity is 7%. By prior agreement the company will skip the coupon interest payments in years 5, 6, and 7. These payments will be repaid without interest at maturity. What is the bonds value?
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