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Consider two bonds, A and B. Both bonds presently are selling at their par value of $1,000. Each pays interest of $80 annually. Bond A

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Consider two bonds, A and B. Both bonds presently are selling at their par value of $1,000. Each pays interest of $80 annually. Bond A will mature in 5 years, while bond B will mature in 7 years. If the yields to maturity on the two bonds change from 9% to 7%, both bonds will increase in value but bond A will increase more than bond B both bonds will decrease in value but bond B will decrease more than bond A both bonds will decrease in value but bond A will decrease more than bond B both bonds will increase in value but bond B will increase more than bond A

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