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Consider a 4 percent coupon U.S. Treasury note that has a $10,000 face value and matures 10 years from today. This note pays interest semiannually.

Consider a 4 percent coupon U.S. Treasury note that has a $10,000 face value and matures 10 years from today. This note pays interest semiannually. The current market interest rate on this bond is 3 percent. Would you expect the bond to be a discount, premium, or par bond? Calculate the actual price of the bond using the PV formula.

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