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QUESTION 8 Bonds X and Y are identical, including the risk class. The only difference between A and B is in the coupon payment as

QUESTION 8

  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 $919.43 ?
    What is the price of bond Y?

    A.

    $956.95
    B.

    $1,007.15
    C.

    $940.92
    D.

    $973.44
    E.

    $925.88
    F.

    $989.75

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