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Two years ago (t=0), Fleming Inc. issued a 20-year zero-coupon bond with a yield to maturity of 5%. The face value of the bond is

Two years ago (t=0), Fleming Inc. issued a 20-year zero-coupon bond with a yield to maturity of 5%. The face value of the bond is $1,000. Because of the operation improvement, the yield to maturity now drops to 4%. (i) What was the bond price at issuance (t=0)? (ii) What is the bond price today (t=2)? A. (i) $447.74; (ii) $493.63 B. (i) $376.89; (ii) $415.52 C. (i) $376.89; (ii) $493.63 D. (i) $447.74; (ii) $415.52

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