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Gordon purchases a newly issued, two-year government bond with a principal amount of $8,000 and a coupon rate of 6% paid annually. One year before
Gordon purchases a newly issued, two-year government bond with a principal amount of $8,000 and a coupon rate of 6% paid annually. One year before the bonds matures (and after receiving the coupon payment for the first year), Gordon sells the bond in the bond market. What price (rounded to the nearest dollar) will Gordon receive for his bond if newly issued one-year government bonds are paying a 5% coupon rate?
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