Noncallable Bonds That Mature in 10 Years Were Recently Issued

question 2

Multiple Choice

Noncallable bonds that mature in 10 years were recently issued by Sternglass Inc.They have a par value of $1,000 and an annual coupon of 5.5%.If the current market interest rate is 7.0%, at what price should the bonds sell?

• A) $829.21
• B) $850.47
• C) $872.28
• D) $894.65
• E) $917.01

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