When a certain type of bond matures, the bondholder is subject to a tax of 25% of

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When a certain type of bond matures, the bondholder is subject to a tax of 25% of the amount of discount at which he bought the bond.

A $1,000 bond of this type has 4% annual coupons and is redeemable at par in 10 years. No tax is payable on the coupons. What price should a purchaser pay if he is to realize an annual yield of 5% after taxes?

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Quality Inspired Management The Key to Sustainability

ISBN: 978-0131197565

1st edition

Authors: Harold Aikens

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Posted Date: Nov 22, 2020 07:45 PM

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When a certain type of bond matures, the bondholder is subject to a tax of 25% of

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Quality Inspired Management The Key to Sustainability

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