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Sheel inc. has 7 percent annual coupon (compounded Semiannually) bonds on the market with 22 years to maturity, and the par value of $1,000. At

Sheel inc. has 7 percent annual coupon (compounded Semiannually) bonds on the market with 22 years to maturity, and the par value of $1,000. At what price should the bonds be selling for if YTM is 5%? Had the bond been selling at $983.55, what would be the YTM (assuming the same coupon, maturity and par value)? Based on your answers above, what is the relationship between YTM and bond price?

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