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please solve all parts a b c d e Homework: HW_CH7 Question! Score: 0 of 12 pts 4 of 14 (0 complete) HW Score: 0%

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Homework: HW_CH7 Question! Score: 0 of 12 pts 4 of 14 (0 complete) HW Score: 0% Problem 7-10 (similar to) (Bond valuation) You own a bond that payn S120 in annual interest, with a $1,000 par value. It matures in 15 years. Your required rate of return is 10 percent. a. Calculate the value of the bond b. How does the value change if your required rate of return (1) increases to 14 percent or (2) decreases to 8 percent? c. Explain the implications of your answers in part (b) as they relate to interest rate risk, premium bonds, and discount bonds d. Assume that the bond matures in 3 years instead of 15 years. Recompute your answers in part (b) o. Explain the implications of your answers in part (d) as they relate to interest rato risk, premium bonds, and dincount bonds. a. If your required rate of return is 10 percent, what is the value of the bond? $(Round to the nearest cent) Homework: HW_CH7 Save Score: 0 of 12 pts 4 of 14 (0 complete) HW Score: 0%, 0 of 100 pts Problem 7-10 (similar to) Question Help (Bond valuation) You own a bond that pays $120 in annual interest, with a $1,000 par value. It matures in 15 years. Your required rate of return is 10 percent. a. Calculate the value of the bond b. How does the value change if your required rate of return (1) increases to 14 percent or (2) decreases to 8 percent? c. Explain the implications of your answers in part (b) as they relate to interest rate risk, premium bonds, and discount d. Assume that the bond matures in 3 years instead of 15 years. Recompute your answers in part (b). e. Explain the implications of your answers in part (d) as they relate to interest rate risk, premium bonds, and discount bonds a. If your required rate of return is 10 percent, what is the value of the bond? bonds (Round to the nearest cont.)

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