Question: Your client has offered a 5-year, $1,000 par value bond with a 10 percent coupon. Interest on this bond is paid quarterly. 1) If your

Your client has offered a 5-year, $1,000 par value bond with a 10 percent coupon. Interest on this bond is paid quarterly.
1) If your client is to earn a nominal rate of return of 12 percent, compounded quarterly, how much should he pay for the bond?
2) How much should he pay if it is a perpetual bond?

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