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A $4,500 bond pays interest at 7% compounded semi-annually. The bond is redeemable in 1 year...

A $4,500 bond pays interest at 7% compounded semi-annually. The bond is redeemable in 1 year 6 months, and is purchased to yield 8%.

  1. Find the purchase price of the bond.
  2. Calculate the premium or discount.
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Answer #1

Please refer to below spreadsheet for calculation and answer. Cell reference also provided.

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