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Trodd Should year parchase the bond at the current market price? Question 2 Djura Limited issues 15-year $1,000 bonds that pay 8 percent interest annually.

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Trodd Should year parchase the bond at the current market price? Question 2 Djura Limited issues 15-year $1,000 bonds that pay 8 percent interest annually. The market price for the bonds is $960. Your required rate of return is 9 percent. (0) Compute the yield to maturity of the bond. Determine the present value of the bond. Should you purchase the bond? (5 marks) (5 marks) (2 marks) Question 3 Transmile's bonds is currently traded in the market at $970. These 20-year bonds pay 7% interest annually on a $1,000 par value. If an investor were to purchase the bond at the market price, what is the yield to maturity to him? (5 marks) Question 4 Espanyol Limited's bond pays coupon interest of 8% on a $1,000 face value with maturity period of 15 years. The bond pays annual interest payments. If your opportunity cost is 10%, what is the price of the bond to you now? (5 marks) HCH

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