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LO3, 5 M7-10. Interpreting Relations among Bond Price, Coupon, Yield, and Credit Rating tigroup Inc. The following appeared in Markets Insider (https://markets.businessinsider.com/bonds) regarding outstand-
LO3, 5 M7-10. Interpreting Relations among Bond Price, Coupon, Yield, and Credit Rating tigroup Inc. The following appeared in Markets Insider (https://markets.businessinsider.com/bonds) regarding outstand- (C) ing bonds issued by Citigroup Inc. Price 166.43 122.70 Coupon (%) Maturity Yield to Maturity (%) Moody's Ratings 6.80 2038 2.40 5.15 2026 1.59 A3 22 A3 a. Discuss the relation among the coupon rate, price, and yield for the bond maturing in 2038. b. Compare the yields on the two bonds. Why are the yields different when the credit ratings are the same?
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