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The Brownstone Corporation's bonds have 5 years remaining to maturity. Interest is paid annually, the bonds have $ 1,000 par value, and the coupon interest
The Brownstone Corporation's bonds have 5 years remaining to maturity. Interest is paid annually, the bonds have $ 1,000 par value, and the coupon interest rate is 10%. a. What is the yield to maturity at a current market price of: (1) $918 or (2) $1,104? b. Would you pay $918 for one os these bonds if you thought the appropriate rate of return was 12%? Explain your answer.
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