Consider the following two bonds that pay interest annually:

Bond A	Coupon Rate	Time-to-Maturity
A	5%	2 years
B	2%	2 years

At a market discount rate of 4%, the price difference between Bond A and Bond B is closest to:

Assume a par value of $1,000.

[Hint: you may calculate each bond price first, then calculate the difference.]

a. 37.7

b. 33.2

c. 56.6

d. 42.8

e. 45.4