Question: 9. Lightning Electrics outstanding bond has a $1000 maturity value and a 5 percent coupon rate of interest (paid semiannually). The bond, which was issued

9.

Lightning Electrics outstanding bond has a $1000 maturity value and a 5 percent coupon

rate of interest (paid semiannually). The bond, which was issued two years ago, matures

in 8 years. If investors require a rate of return equal to 7.5 percent to invest in similar

bonds, what is the current market value of Lightnings bond?

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