Question: What would you pay for a $500,000 debenture bond that matures in 20 years and pays $50,000 a year in interest if you wanted to

What would you pay for a $500,000 debenture bond that matures in 20 years and pays $50,000 a year in interest if you wanted to earn a yield of?

(a) 8%?

(b) 10%?

(c) 12%?


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