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i need A-C Basic bond valuation Complex Systems has an outstanding issue of $1,000-par-value bonds with a 11% coupon interest rate. The issue pays interest
i need A-C
Basic bond valuation Complex Systems has an outstanding issue of $1,000-par-value bonds with a 11% coupon interest rate. The issue pays interest annually and has 20 years remaining to its maturity date. a. If bonds of similar risk are currently earning a rate of retum of 7%, how much should the Complex Systems bond sell for today? b. Describe the two possible reasons why the rate on similar-risk bonds is below the coupon interest rate on the Complox Systems bond. c. If the required return were at 11% instead of 7%, what would the current value of Complex Systems' bond be? Contrast this finding with your findings in part a and discuss. a. If bonds of similar risk are currently eaming a rate of retum of 7%, the Complex Systems bond ahould sell today for (Round to the nearest cent.) Step by Step Solution
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