Assume a healthcare organization sold bonds

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Assume a healthcare organization sold bonds that have a twelve-year maturity, a 14% coupon rate with annual payments, and a $1,000 par value.

Suppose that three years after the bonds were issued, the required interest rate fell to 9%. What would be the bonds’ value?

Suppose that three years after the bonds were issued, the required interest rate rose to 17%. What would be the bonds’ value?

What would be the value of the bonds six years after issue in each scenario above, assuming that interest rates stayed steady at either 9% or 17%?.

Reference no: EM13924459

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