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For the following pair of Treasury securities (each with $1,000 par value), identify which will have the higher price: Question : A six-year zero-coupon bond
For the following pair of Treasury securities (each with $1,000 par value), identify which will have the higher price:
Question : A six-year zero-coupon bond or a five-year 3%-coupon bond?
A. We can't tell - it depends on current interest rates.
B. A six-year zero-coupon bond.
C. A five-year 3%-coupon bond.
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