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You want to buy a $2000 corporate bond maturing in 3 years with a coupon rate of 9%. The current market rate is of 7%.
You want to buy a $2000 corporate bond maturing in 3 years with a coupon rate of 9%. The current market rate is of 7%. Answer the following questions: 1) How much is the bond going to cost you today? 2) Will the coupon rate change if the market rate rises to 8%? 3) What will the price be of the bond if market rate is 6%?
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