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the bottom photo needs to be done first. Consider the original bond (see question 13) with 30 years to go. Suppose that your best alternative
the bottom photo needs to be done first.
Consider the original bond (see question 13) with 30 years to go. Suppose that your best alternative asset yields -.07 = 7% per year. How much would you pay for the bond in this case? Notice that the value of the bond will decrease if the rate of return on your best alternative asset increases!!! a. $7518.14 b. $8375.13 C. 58957.93 d. $10,045.68 e. None of these What price would you be willing to pay for a bond with a $10,000 maturity value, a 30 year term to maturity, and a $500 coupon payment, when the alternative asset with the best return is r -.03. a $8935.42 b. $9571.83 c. $11315.22 d. $13,920.35 e. None of theseStep by Step Solution
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