Buner Corp’s outstanding bonds, which has a face value of $1,000, have 6 years remaining to maturity. The bond’s coupon rate of interest is 8%, and interest is paid semiannually. If investors require a rate of return equal to 6% to invest in similar risk bonds, what should be the market price of Buner’s bond?

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
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Buner Corp’s outstanding bonds, which has a face value of $1,000, have 6 years remaining to maturity. The bond’s coupon rate of interest is 8%, and interest is paid semiannually. If investors require a rate of return equal to 6% to invest in similar risk bonds, what should be the market price of Buner’s bond?

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