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Chrome File Edit View History Bookmarks People Window Help 00 / D Connect Assignment #4 (Sumx Suppose The Real Rate ls 2.5 × caezto.mheducation.com/hm.tpx Connect Assignment #4 (Summer 2018)

Solution

current Bond price= [PVA 10%,6 * Annual interest ] +[PVF 10%,6 *face value]

       =[4.35526*60]+[.56447*1000]

       = 261.32+ 564.47

       = 825.79

**let the face value be 1000 .annual interest = 1000*.06 = 60

correct option is \" E\"