Question 4: What is the value today of the following two bonds? Which of the two bonds has a greater value today bond A or B?

Bond A:

Par Value: $1,400

Coupon Rate = 10% paid annually

Yield to Maturity = 5.5%

Maturity = 4 Years

Bond B:

Par Value: $1,600

Coupon Rate = $140 paid annually

Yield to Maturity = 4%

Maturity = 5 Years