The Crystal Center has issued bonds that will pay $42 one year from today. Then going forward this amount will increase by 3.8% each year forever. If these bonds are selling for $846, what is the discount rate for the bonds? (Please enter your answer as a whole number to two decimal places. i.e. 2.25, not 0.0225)

The Crystal Center has issued bonds that will pay $42 one year from today. Then going forward this amount will increase by 3.8% each year forever. If these bonds are selling for $846, what is the discount rate for the bonds? (Please enter your answer as a whole number to two decimal places. i.e. 2.25, not 0.0225)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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