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Wine and Roses, Inc. offers a 5.5 percent coupon bond with semiannual payments and a yield...

Wine and Roses, Inc. offers a 5.5 percent coupon bond with semiannual payments and a yield to maturity of 5.90 percent. The bonds mature in 6 years. What is the market price of a $1,000 face value bond?

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Answer #1

Calculate the price of the bond as follows (1+7)丿しFace value 7 5.90% $1,000 5.5%xS1,000 5.90% 5.90% (1.0295)S1,000 =| $27.5×

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