Madsen Motors’s bonds have 23 years remaining to maturity. Interestis paid annually, they have a $1,000 par value, the coupon interest rate is 9%, and the yieldto maturity is 11%. What is the bond’s current market price?

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter4: Bond Valuation
Section: Chapter Questions
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Madsen Motors’s bonds have 23 years remaining to maturity. Interest
is paid annually, they have a $1,000 par value, the coupon interest rate is 9%, and the yield
to maturity is 11%. What is the bond’s current market price?

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