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Diamond Corporation is planning a bond issue with an escalating coupon rate. The annual coupon rate will be 4% for the first 2 years, 5%

Diamond Corporation is planning a bond issue with an escalating coupon rate. The annual coupon rate will be 4% for the first 2 years, 5% for the subsequent 3 years, and 6% for the final 4 years. If bonds of this risk are yielding 7%, estimate the bond's current price. Face value of the bond is $1,000.

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