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If an ordinary bond has a coupon rate of 14%, then the owner will get a total of $140 per year, but this $140 will
If an ordinary bond has a coupon rate of 14%, then the owner will get a total of $140 per year, but this $140 will come in two payments of $70 each. The yield to maturity is quoted at 16%. The bond matures in 7 years.
a. How many coupons are there?
b. What is the semiannual coupon payment?
c. What is the semiannual yield?
d. What is the bond price?
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