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Suppose that you are interested in purchasing a bond issued by the VPI Corporation. The bond is quoted in the Wall Street Journal as selling
Suppose that you are interested in purchasing a bond issued by the VPI Corporation. The bond is quoted in the Wall Street Journal as selling for 84.839. How much will you pay for the bond if you purchase it at the quoted price? Assuming you hold the bond until maturity, how much will you receive at that time? If you purchase the bond at the quoted price, you would pay $ (Round to the nearest cent.) Assuming you hold the bond until maturity, you would receive $1. (Round to the nearest dollar.) Using your financial calculator, calculate the value of the following bonds: Par Value $1,000 $1,000 $1,000 Coupon Rate 5% 5% 5% Required Rate of Return 5.0% 11.0% 4.0% Years to Maturity 10 10 10 Click on the table icon to view the PVIF table Click on the table icon to view the PVIFA table The value of the bond with a 5.0% required rate of return is $ (Round to the nearest cent.) The value of the bond with a 11.0% required rate of return is $ (Round to the nearest cent.) The value of the bond with a 4.0% required rate of return is $ (Round to the nearest cent.)
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