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    Estimating Price of a coupon paying bond

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    What is the price of a 10 year $1000 Par Value Bond if the coupon rate is 10% (pays $100 a year if dividends paid annually) with 8 years to go to maturity. Interest rates (expected rate of return) is 8%?

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    The Fair value of a bond is given by
    Value of bong = Present value of annual ...

    Solution Summary

    Solution describes the formula and steps for calculating price of a coupon paying bond.