Essay
A bond with 12 years to maturity has a 7 percent semiannual coupon and a face value of $1,000. (That is, the bond pays a $35 coupon every six months.) The bond currently sells for $1,010. What should be the price of a bond that pays a 7 percent annual coupon and has a face value of $1,000 with the same risk and maturity as the semiannual bond?
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