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Q12) A bond with a $1,000 par value has an 7.25% coupon rate. It will mature in 5 years, and coupon payments are made annually.

Q12) A bond with a $1,000 par value has an 7.25% coupon rate. It will mature in 5 years, and coupon payments are made annually. Present annual yields on similar bonds are 9.75%. What should the current price be?

a. 904.62

b. 913.61

c. 972.56

d 980.33

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