Noncallable bonds that mature in 10 years were recently issued by Sternglass Inc. They have a par value of $1,000 and an annual coupon of 5.5%. If the current market interest rate is 7.0%, at what price should the bonds sell?
A. $829.21
B. $850.47
C. $872.28
D. $894.65
E. $917.01
Answer: D
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