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Media Bias incorporated issuectbonds 1 0 years ago at $ 1 , 0 0 0 per bond. These bonds had a 2 5 - year

Media Bias incorporated issuectbonds 10 years ago at $1,000 per bond. These bonds had a 25-year life when issued and the annual
interest payment was then 10 percent. This retum was in line with the required returns by bondholders at that point in time as
described below:
Assume that 10 years tater, due to good publicity, the risk premium is now 2 percent and is appropriately reflected in the required
return (or yield to maturity) of the bonds. The bonds have 15 years remaining until maturity.
Compute the new price of the bond. Use ARpendix B and A pendix D for an approximate answer but calculate your final answer using
the formula and financial calculator methods
Note: Do not round intermediate calculotions. Round your final onswer to 2 decimal places. Assume interest payments are annual.
Answer is complete but not entirely correct.
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