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Consider two bonds with identical features issued at the same time, except one will mature in 5 years and the other in 10 years. Both
Consider two bonds with identical features issued at the same time, except one will mature in 5 years and the other in 10 years. Both bonds were issued at par. Interest rates have decreased since their issue. If interest rates remain constant, how will the value of the 5-year bond compare with the value of the 10-year bond? The value of the 5-year bond will be greater than the value of the 10-year bond The value of the 5-year bond will be less than the value of the 10-year bond The value of the 5-year bond will be the same as the value of the 10-year bond The value of the 10-year bond will decreased while the value of the 5-year bond cannot be determined
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