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Question
A bond matures in 20 years, at which time it pays the owner $1,000. It also pays $70 at the end of each of the next 20 years. If similar bonds are currently yielding 7%, what is the market value of the bond?A) over $1,000
B) under $1,000
C) exactly $1,000
D) cannot be determined from the information given
Answer
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