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( Related to Checkpoint 9 . 2 and Checkpoint 9 . 3 ) ( Bond valuation relationships ) The 1 7 - year, $ 1

(Related to Checkpoint 9.2 and Checkpoint 9.3)(Bond valuation relationships) The 17-year,
$1,000 par value bonds of Waco Industries pay 11 percent interest annually. The market price of the
bond is $885, and the market's required yield to maturity on a comparable-risk bond is.14 percent.
a. Compute the bond's yield to maturity.
b. Determine the value of the bond to you given the market's required yield to maturity on
a comparble-risk bond.
c. Should you purchase the bond?
a. What is your yield to maturity on the Waco bonds given the current market price of the bonds?
%(Round to two decimal places)
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