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(Related to Checkpoint 9.2 and Checkpoint 9.3) (Bond valuation) Fingen's 14-year, $1,000 par value bonds pay 13 percent interest annually. The market price of
(Related to Checkpoint 9.2 and Checkpoint 9.3) (Bond valuation) Fingen's 14-year, $1,000 par value bonds pay 13 percent interest annually. The market price of the bonds is $910 and the market's required yield to maturity on a comparable-risk bond is 16 percent. a. Compute the bond's yield to maturity. b. Determine the value of the bond to you, given your required rate of return. c. Should you purchase the bond? a. What is your yield to maturity on the Fingen bonds given the market price of the bonds? % (Round to two decimal places.)
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