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Business, 30.03.2021 05:20 Abrow484

Emily is contemplating the purchase of a 20-year bond that pays $50 interest every six months. The face value of the bond is $1,000. She plans to hold the bond for 10 years and sell it. She requires a 12 percent annual return but believes that the market will give only an 8 percent return when she sells the bond 10 years from now. Assuming she is a rational investor, how much should she be willing to pay for the bond today

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Emily is contemplating the purchase of a 20-year bond that pays $50 interest every six months. The f...
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