Question
Bond par value: $1,000 &nbs
Bond par value: $1,000 Coupon interest rate: 10%
Market interest rate: 10⅞% Time to maturity: 5 years
(1): What is the bond price when interest payments are paid annually?
(2): Municipal bonds receive special tax treatment. What is this special tax treatment and why is it applied to municipal bonds only? (25 word limit)
Homework Answers
Answer #1
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