Consider the following two bonds that pay interest annually: At a market discount rate of 4%, the
Question:
Consider the following two bonds that pay interest annually:
At a market discount rate of 4%, the price difference between Bond A and Bond B per 100 of par value is closest to:
A. 3.70.
B. 3.77.
C. 4.00.
Transcribed Image Text:
Bond A B Coupon Rate 5% 3% Time-to-Maturity 2 years 2 years
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