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25 years ago, Delicious Mills, Inc. issued 30-year to maturity bonds that had a 8.16 percent...

25 years ago, Delicious Mills, Inc. issued 30-year to maturity bonds that had a 8.16 percent annual coupon rate, paid semiannually. The bonds had a $1,000 face value. Since then, interest rates in general have changed and the yield to maturity on the Delicious Mills bonds is now 10.48 percent. Given this information, what is the price today for a Delicious Mills bond?

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Answer #1
                  K = Nx2
Bond Price =∑ [(Semi Annual Coupon)/(1 + YTM/2)^k]     +   Par value/(1 + YTM/2)^Nx2
                   k=1
                  K =5x2
Bond Price =∑ [(8.16*1000/200)/(1 + 10.48/200)^k]     +   1000/(1 + 10.48/200)^5x2
                   k=1
Bond Price = 911.46
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