The Issuer Corporation issued a 20-year bond with a 6 percent coupon. The bond had a yield to maturity of 8 percent one year after issuance. the value of Issuer's bond one year after issuance, in bond quote terms, is closest to:

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The value of the bond can be calculated using the present value of its future cash flows, which include the annual coupon payments and the principal amount at maturity. Given a 6% coupon on a 20-year bond and a yield to maturity of 8% one year after issuance, the bond's price would decrease because the market interest rates have risen above the coupon rate. The bond's price can be calculated as the present value of the remaining 19 years of coupon payments plus the present value of the principal amount, discounted at the new yield to maturity of 8%. The correct calculation leads to a value closest to option C, 80.63. This reflects the bond's price in terms of a percentage of its face value, indicating it would sell at a discount because the yield to maturity exceeds the coupon rate.

The Issuer Corporation Issued a 20-Year Bond with a 6