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Please answer both questions thank you! 40. A 10 year annual payment corporate coupon bond has an expected return of 10% and a required return
Please answer both questions thank you!
40. A 10 year annual payment corporate coupon bond has an expected return of 10% and a required return of 12% and a par value of $1,000. The bond's current market price must be A) Greater than its fair present value B) Greater than par C) Less than its expected rate of return D) Less than its fair present value E) $1,000.00 41. A 10 -year corporate bond pays $55 interest every six months. What is the bond's fair market price if investors' required return is 6.25% annually and the bond has a $1,000 face value? A) $1,175.32 B) $1,349.29 C) $1,235.53 D) $1,052.97 E) $1,210.83 Step by Step Solution
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