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Question Help * P6-19 (similar to) bonds both have $1,000 par values and 13% coupon interest rates and pay annual interest. Bond A has exactly
Question Help * P6-19 (similar to) bonds both have $1,000 par values and 13% coupon interest rates and pay annual interest. Bond A has exactly 8 years to maturity, and bond B has 18 years to maturity. a. Calculate the present value of bond A if the required rate of return is: (1) 10%, (2) 13%, and (3) 16% b. Calculate the present value of bond B if the required rate of return is: (1) 10%, (2) 13%, and (3) 16% c. From your findings in parts a and b, discuss the relationship between time to maturity and changing required returns. d. If Lynn wanted to minimize interest rate risk, which bond should she purchase? Why
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