Question: A 2 5 - year MBB is issued. The bond has a par value of $ 1 0 , 0 0 0 and promised to

A 25-year MBB is issued. The bond has a par value of $10,000 and promised to pay an 8 percent annual coupon. Assume that 20 years after the bond is used, bond market investors now required 11.3% yield on the bond. The bound is said to be selling at a discount. What is initial price on bond? a. $588 b. $6835 c. $6,863 d. $14,270

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