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An investor is considering buying one of two 1 0 - yeat, $ 1 , 0 0 0 face value bonds: Bond A has a

An investor is considering buying one of two 10-yeat, $1,000 face value bonds: Bond A has a 7% annual
coupon, while Bond B has a 9% annual coupon. Both bonds have a yield to maturity of 8%, which is
expected to remain constant for the next 10 years. Which of the following statements is CORRECT?
Bond A has a higher price than Bond B today, but one year from now the bonds will have the same
price as each other.
Bond B has a higher price than Bond A today, but one year from now the bonds will have the same
price as each other.
Both bonds have the same price today, and the price of each bond is expected to remain constant until
the bonds mature.
One year from now, Bond A's price will be higher than it is today.
Bond A's current yield is greater than 8%.
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