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There is an issue of 4,500 coupon bonds outstanding that have a face value of $1,000, mature in 18 years, and pay 5.75% (annual) coupons.
There is an issue of 4,500 coupon bonds outstanding that have a face value of $1,000, mature in 18 years, and pay 5.75% (annual) coupons. These bonds are currently trading at 122.154% of par.
1. What is the value of the coupon bonds?
2. What is the before-tax required return on the coupon bonds?
3. What is the after-tax required return on the coupon bonds?
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