. What is the market value of a $1,000 face value bond that pays an annual interest...
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Question:
. What is the market value of a $1,000 face value bond that pays an annual interest rate of 6.5 percent, with seven years to maturity, assuming the current market rate to be 2.75 percent? Is this bond trading at par, premium, or discount? What is its cost of debt to the company, assuming a 35 percent tax rate?
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