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Bond X is a premium bond making annual payments. The bond pays an 8 percent coupon, has a YTM of 6 percent, and has 13
Bond X is a premium bond making annual payments. The bond pays an 8 percent coupon, has a YTM of 6 percent, and has 13 years to maturity. Bond Y is a discount bond making annual payments. This bond pays a 6 percent coupon, has a YTM of 8 percent, and also has 13 years to maturity. If interest rates remain unchanged, you would expect that one year from now, Bonds X and Y will be priced at $ and $, respectively. In three years, they will be priced at $ and $ . In eight years: $ and $ . In 12 years: $ and $. And in 13 years: $ and $
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