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Business, 10.12.2020 17:00 kahmir15

A 16-year, $1,000 par value zero-coupon rate bond is to be issued to yield 6 percent. Required:
a. What should be the initial price of the bond?
b. If immediately upon issue, interest rates dropped to 5 percent, what would be the value of the zero-coupon rate bond?
c. If immediately upon issue, interest rates increased to 10 percent, what would be the value of the zero-coupon rate bond?

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A 16-year, $1,000 par value zero-coupon rate bond is to be issued to yield 6 percent. Required:
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