Solved: How much an investor would have to pay for bond, Financial Accounting

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How much an investor would have to pay for bond

Response to the following problem:

A 25-year, zero-coupon bond was recently being quoted at 11.625% of par. Find the current yield and the promised yield of this issue, given that the bond has a par value of $1000. Using semi-annual compounding, determine how much an investor would have to pay for this bond if it were priced to yield 12%.

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Financial Accounting: How much an investor would have to pay for bond

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