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Sasha Company has a level-coupon bond outstanding with a 9% coupon rate, payable annually. The bond has 20 years to maturity and a face
Sasha Company has a level-coupon bond outstanding with a 9% coupon rate, payable annually. The bond has 20 years to maturity and a face value of $1,000; similar bonds currently yield 7%. By prior agreement the company will skip the coupon interest payments in years 8, 9 and 10. These payments will be repaid, without interest, at maturity. What is the bond's value? Answer:
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To find the bonds value we need to calculate the present value of all the cash flows associated with the bond Given that the coupon payments for years ...
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Practical financial management
Authors: William r. Lasher
5th Edition
0324422636, 978-0324422634
