Find the face value of the bond

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An investor owns a $3000 par-value 12% bond with semiannual coupons. The bond will mature at par at the end of fourteen years. The investor decides that a ten-year bond would be preferable. Current yield rates are 6% convertible semiannually. The investor uses the proceeds from the sale of the 12% bond to purchase of an 8% bond with semiannual coupons, maturing at par at the end of ten years. Find the face value of the 8% bond.

Reference no: EM131022128

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