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Sally is computing the present value of a semi-annual coupon bond that has a 5 percent yield to maturity, a 4 percent coupon, and six
Sally is computing the present value of a semi-annual coupon bond that has a 5 percent yield to maturity, a 4 percent coupon, and six years to maturity. Which one of the following is correct?
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The present value is assumed to be $1,000.
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The amount of each interest payment is $40.
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The current price of the bond will be greater than the par value.
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The bond is selling at a discount.
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