The tables below show, respectively, the characteristics of two annual-coupon bonds from the same issuer with the same priority in the event of default, as well as spot interest rates on zero-coupon bonds. Neither coupon bond's price is consistent with these spot rates. Using the information in these tables, recommend either bond A or bond B for purchase.

	Bond A	Bond B
Coupons	Annual	Annual
Maturity	3 years	3 years
Coupon rate	10%	6%
Yield to maturity	10.65%	10.75%
Price	98.40	88.34

	Spot Interest Rates
Term (years)	Spot Rates (zero-coupon)
1	5%
2	8
3	11