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Valero Inc. is planning to offer a $1,000 par value 9-year maturity bond with a coupon interest rate that changes every 3 years. The coupon
Valero Inc. is planning to offer a $1,000 par value 9-year maturity bond with a coupon interest rate that changes every 3 years. The coupon rate for the first three years is 11.30 percent, 13.70 percent for the next 3 years, and 14.85 percent for the final 3 years. If you require a 25 percent rate of return on a bond of this quality and maturity, what is the maximum price you would pay for the bond? (Assume interest is
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