# Calculating cash flow and price of bonds (based on varying discount rates)

1. What is the cash flow of a 6% coupon bond that pays interest annually, matures in 7 years, and has a principle of $1,000?

2. Assuming a discount rate of 8%, what is the price of this bond?

3. Assuming a discount rate of 8.5%, what is the price of the bond?

4. Assuming a discount rate of 7.5%, what is the price of the bond?

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$2.19