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Business, 04.07.2020 21:01 trillsmith

A well-known industrial firm has issued $1,000 bonds that carry a 4% coupon interest rate paid semiannually. The bonds mature 20 years from now, at which time the industrial firm will redeem them from $1,000 plus the terminal semiannual interest payment. From the financial pages of your newspaper you learn that the bonds may be purchased for $715 each ($710 for the bond plus a $5 sales commission). What nominal annual rate of return would you receive if you purchased the bond now and held it to maturity 20 years from now

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