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Problem 5 : Long - term Horizons Bond A with maturity 2 5 years and F = $ 5 , 0 0 0 pays an
Problem : Longterm Horizons
Bond A with maturity years and F $ pays an annual coupon X It has yield to maturity
and currently sells for $ Bond B with F $ and an annual coupon of $ has
also maturity years.
Is the annual coupon of bond A above, below or exactly $
Price coupon bond B
What should the annual coupon of B be in order for it to sell at par?
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