Bond 1 has an annual coupon rate of 6 per cent and Bond 2 has an annual
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Bond 1 has an annual coupon rate of 6 per cent and Bond 2 has an annual coupon of 12 percent. Both bonds mature in one year and have a par value of €100. If the yield to maturity on bonds of this risk class is 10 per cent at what price will the bonds sell? Assume that the next coupons are due in one year’s time.
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