Question: Springfield Industries recently issued 1 5 - year, $ 1 , 0 0 0 par value bonds that pay 5 . 2 5 percent annual

Springfield Industries recently issued 15-year, $1,000 par value bonds that pay 5.25 percent annual interest and makes interest payments on an annual basis. The current market price of the bond is $1,010, and the market's required yield to maturity on a comparable-risk bond is 5.0 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? Explain your reasoning.
a. Determine the Yield to Maturity.
b. What is the value of the bond to you given the yield to maturity on a comparable-risk bond?
c. Should you purchase the bond at the current market price? Why?

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