Suppose a $1,000 bond pays $60 per year in interest. (a) What is the contractual interest rate

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Suppose a $1,000 bond pays $60 per year in interest.

(a) What is the contractual interest rate (“coupon rate”) on the bond?

(b) If market interest rates rise to 8 percent, what price will the bond sell for?

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The Macro Economy Today

ISBN: 978-1259291821

14th edition

Authors: Bradley R. Schiller, Karen Gebhardt

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Question Posted: May 30, 2018 02:58 AM

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Suppose a $1,000 bond pays $60 per year in interest. (a) What is the contractual interest rate

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