Bond valuation
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Zumwalt Corporation's Class S bonds have a 12-year maturity, $1,000 par value, and a 5.75% coupon paid semiannually (2.875% each 6 months), and those bonds sell at their par value. Zumwalt's Class A bonds have the same risk, maturity, and par value, but the A bonds pay a 5.75% annual coupon. Neither bond is callable. At what price should the annual payment bond sell?
$943.98
$968.18
$993.01
$1017.83
$1043.28
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Solution Summary
The solution explains how to determine the price of a bond
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