What is the present value of an annual pay bond with two years to maturity that is priced at 102 and pays a 6% coupon, assuming a discount rate of 10%?
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The bond has a face value of $100 (standard for bond calculations unless stated otherwise), a coupon rate of 6%, and two years until maturity. This means the bond pays an annual coupon of 6% of $100, which is $6 per year. Show more…
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