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What is the value of its 10-year bonds outstanding with the same risk of 10% as...

What is the value of its 10-year bonds outstanding with the same risk of 10% as before, but a 13% annual coupon rate?

Please explain it with the BA2 calculator!

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Answer #1
Assume Face Value of Bond $100
Rate Discount Rate 10%
Nper Number of Years 10
Pmt Annual coupon amount =13%*100 $13
Fv Payment at maturity $100
PV VALUE OF BOND $118.43
(Using PV function of excel)
Value of Bond=118.43% of Face Value

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