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d. How is the value of a bond determined? What is the value of a 10-year, $1,000 par value bond with 10% annual coupon if
d. How is the value of a bond determined? What is the value of a 10-year, $1,000 par value bond with 10% annual coupon if its required rate of retu is 10% ? e. What is the expected value of the bond described in d) if, just after it had been issued, the expected inflation rate rose by 3%, causing investors to require a 13% return? Would we now have a discount or a premium bond? f. What is the yield to maturity on a 10-year, 9% annual coupon, $1,000 par value bond that sells for $8877 That sells for $1,134,207 What does the fact that bond sells at a discount or premium tell you about the relationship between ra and the bond's coupon rate? g. How does the equation for valuing a bond change if semiannual payments are made? Find the value of a 10-year, semiannual payment, 10% coupon bond if nominal ra = 13%
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