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Ceteris paribus, a two-year zero-coupon bond with yield-to-maturity equal to five percent is cheaper than a two-year ten percent coupon bond with yield-to-maturity equal to
Ceteris paribus, a two-year zero-coupon bond with yield-to-maturity equal to five percent is cheaper than a two-year ten percent coupon bond with yield-to-maturity equal to five percent because: The zero-coupon bond has less interest rate risk. The zero-coupon bond has a shorter duration. The zero-coupon bond has more default risk. None of the above
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