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Coupon Bonds and Interest

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X Company 7% coupon bonds pay interest semiannually. When u bought one it had 11 yrs to maturity and the appropriate discount rate was 9%. After 1 yr th discount rate on such bonds in 8% because of the improved financial health of the Company. If u sell the bond today, what would your capital gain be?

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The solution is very easy to understand and concise. It is an excellent response for students who want to understand the concepts and then use the same concepts to solve similar problems in the future. Overall, an excellent response. The solution provides the necessary steps which are easy to follow.

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I recommend that you use Excel or a financial calculator to solve such problems. In the absence of a financial calculator, I'll show ...

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