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Dynamo Corporation Has Semiannual Bonds Outstanding with 12 Years to Maturity

question 86

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Dynamo Corporation has semiannual bonds outstanding with 12 years to maturity, and the bonds are currently priced at $1,080.29. If the bonds have a coupon rate of 8 percent, then what is the equivalent annual return (EAR) to the investor for purchasing the bonds at the described price? Round your final percentage answer to two decimal places.


Definitions:

Embezzlement

The fraudulent appropriation of funds or property entrusted to one's care but owned by someone else.

Permanently

Describing a condition or state that is intended to last indefinitely or for a lifelong duration.

Presumed Guilt

The principle or state of assuming an individual is guilty without evidence or before the completion of a fair and just legal process.

Legal System

The comprehensive framework of rules and institutions within a society that govern individuals, entities, and their interactions.

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