value bonds pay14 percent interest annually. The market price of the bonds is $950 and the market's required yield to maturity on a​ comparable-risk bond is16 percent. What should be the value of the Fingen bonds give

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
Problem 16P
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Fingen's 16​-year,​$1,000 par value bonds pay14 percent interest annually. The market price of the bonds is $950 and the market's required yield to maturity on a​ comparable-risk bond is16 percent. What should be the value of the Fingen bonds given your required rate of return on a​ comparable bond? (Round to the nearest​ cent.)

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