QUESTION 20

1. Bonds X and Y are identical, including the risk class. The only difference between A and B is in the coupon payment as shown below.

   	Bond X	Bond Y
   Face value	$1,000	$1,000
   Annual Coupon Payment	$120	$130
   Payment Frequency	Semiannual	Annual
   Years to maturity	15	15
   Price	$904.55	?

   What is the price of bond Y?

   	A.	$989.75
   	B.	$1,007.15
   	C.	$940.92
   	D.	$973.44
   	E.	$956.95
   	F.	$925.88