Question: ( Bond valuation relationships ) The 1 5 - year, $ 1 , 0 0 0 par value bonds of Waco Industries pay 1 2

(Bond valuation relationships) The 15-year, $1,000 par value bonds of Waco Industries pay 12 percent interest annually. The market price of the bond is $1,115, and the market's required yield to maturity on a comparable-risk bond is 9 percent.
a.Compute the bond's yield to maturity.
b.Determine the value of the bond to you given the market's required yield to maturity on a comparable-risk bond.
c.Should you purchase the bond?

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