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Suppose a State of New York zero coupon municipal bond will repay an investor the $1,000 face value of their bond seven years from now.
Suppose a State of New York "zero coupon" municipal bond will repay an investor the $1,000 "face value" of their bond seven years from now. No additional coupons or payments will be made between now and maturity.
If the current interest rate on these 8-year bonds is 4.8%, how much is the bond worth today?
Please enter your answer to the nearest cent, or penny.
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