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IBM issues an 11% annual coupon rate bond that matures in 16 years. The face value is $1000. The required rate of return on bonds

IBM issues an 11% annual coupon rate bond that matures in 16 years. The face value is $1000. The required rate of return on bonds of similar risk and maturity is 9%.

1. Is this IBM bond selling at a premium, at par or at a discount and explain why?

2. What is the price of this bond and show how?

3. Coupon payments are made monthly. What is the price of THIS bond and show how you got your answer?

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