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The buffalo bills 10% coupon rate, semiannual payment, $1000 par value bonds, which mature in 25 years, are callable 5 years from today at $1,075.

The buffalo bills 10% coupon rate, semiannual payment, $1000 par value bonds, which mature in 25 years, are callable 5 years from today at $1,075. They sell at a price of $1,203.85 and the yield curve is flat. Assume that interest rates are expected to remain at their current level. If the buffalo bills plan to raise additional capital and want to use debt financing, what coupon rate would it have to set to issue new bonds at par?

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