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The current interest rate is 8%. Next year, the interest rate will be 3.8% (with 31% probability) or 10.07%. A perpetual bond is callable at
The current interest rate is 8%. Next year, the interest rate will be 3.8% (with 31% probability) or 10.07%. A perpetual bond is callable at $1,089, and it will be called if the interest rate drops to 3.8%. What is the coupon amount (in $) if the bond is priced to sell at par
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