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XYZ, Inc. issued two 10-year bonds, one is zero coupon bond and the other has acoupon rate of 10%. Both bonds have a face value

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XYZ, Inc. issued two 10-year bonds, one is zero coupon bond and the other has acoupon rate of 10%. Both bonds have a face value of $1,000, with a yield to maturity of 10%. Which of the following statements is true? A. Both bonds must sell for the same price if markets are in equilibrium. B. The zero coupon bond must have a higher price because of its greater capital gain potential. C. The zero coupon bond must sell for a lower price than the bond with an 10% coupon rate. D. All rational investors will prefer the 10% bond because it pays more interest

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