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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
A bond promises to pay $500 one year from now. For the following prices, find the corresponding interest payments and interest rates that the bond offers.
Â
Â
|
 |
Amount Paid |
 |
 |
|
Price |
in One Year |
Interest Payment |
Interest Rate |
|
$375 |
$500Â |
_____________ |
_____________ |
|
$425 |
$500Â |
_____________ |
_____________ |
|
$450 |
$500Â |
_____________ |
_____________ |
|
$500 |
$500Â |
_____________ |
_____________ |
As the price of the bond rises, what happens to the bond’s interest rate?
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