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Wine and Roses, Inc. offers an 8.0% coupon bond with semiannual payments and a yield to maturity of 8.66 percent. The bo...

Wine and Roses, Inc. offers an 8.0% coupon bond with semiannual payments and a yield to maturity of 8.66 percent. The bond matures in 16 years. What is the market price of a $1,000 face value bond? What is the current yield of the bond? How much interest does the bond accrue 50 days after a coupon payment?

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Answer #1

1.
=8%*1000/8.66%*(1-1/(1+8.66%/2)^(2*16))+1000/(1+8.66%/2)^(2*16)
=943.41803094

2.
=8%*1000/943.41803094
=8.48%

3.
=50/182*8%*1000/2
=10.98901099

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