Exhibit 20-2 USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)

Multiple Choice

Exhibit 20-2
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)
A major manufacturer is reevaluating its bonds since it is planning to issue a new bond in the current market. The firm's outstanding bond issue has 7 years remaining till maturity. The bonds were issued with an 8% coupon rate (paid quarterly) and a par value of $1,000. The required rate of return is 10%.
-Refer to Exhibit 20-2. What will be the value of these securities in one year if the required return is 6%?

A) $1151.92
B) $972.52
C) $1100.15
D) $900.18
E) $936.72