Question: Answer part d 5. A $1,000 maturity value bond currently has 9 years left to maturity. The bond has a 6% coupon rate and pays

Answer part d 5. A $1,000 maturity value bond currently has 9 years left to maturity. The bond has a 6% coupon rate and Answer part d

5. A $1,000 maturity value bond currently has 9 years left to maturity. The bond has a 6% coupon rate and pays interest annually. 5) a. If you want to earn a 7% rate of return, how much would you be willing to pay today for this bond? d. Suppose you buy the bond for the value calculated in part a. After holding the bond for 2 years and receiving 2 interest payments, the bond defaults with no chance of paying you anything more. What annual, compound rate of return have you earned over this 2 year period

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